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In
Question 4 options:
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Efficient, and the distribution of goods will also be completely equal |
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Inefficient and too large - capitalistic sellers flood the markets! |
|
Efficient |
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Inefficient and too small - sellers don't supply enough because they don't care about buyers |
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- Suppose goods X and Y are complimentary products. Which of the following are correct with respect to the competitive market model of supply and demand? (check all that apply) an increase in the price of good Y will cause an increase in demand for good X and reduce the quantity demanded for good Y an increase in the price of good Y will cause a decrease in demand for good X and reduce the quantity demanded for good Y a decrease in the price of good X will increase the quantity demanded for good X and cause a decrease in demand for good Y a decrease in the price of good X will increase the quantity demanded for good X and cause an increase in demand for good YSuppose you discover a stream in northern Minnesota whose water has amazing powers for healing. You decide to sell bottles of the water. The market demand curve is linear and is given as follows: P = 30 - Q The marginal cost to produce this amazing water is $3 per bottle. a. In a competitive market, what price would this water sell for and how much would you sell? Show your calculations. P = _____, Q = ______ b. After taking this class, you realize that you have monopoly power in this market. To maximize your profits, what quantity would you sell and what would the price per bottle be? (Hint: what is marginal revenue for a monopolist?) Show your calculations. Pm = ____, Qm = ____ c. Now draw a graph to the right with price on the vertical axis and quantity on the horizontal axis and show the competitive market solution and the monopoly output and prices.A city passes a law that automobile prices may not increase. The auto market is currently in equilibrium. What will happen in that market if costs of producing autos increase? Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a More than the allocatively efficient amount will be produced. b Less than the allocatively efficient amount will be produced. c The allocatively efficient amount will be produced but there will be a shortage. d The allocatively efficient amount will be produced but there will be a surplus.
- Assume that the resource market is purely competitive. If the price of the resource falls, other factors constant, then a firm that sells its product in a purely competitive market will Multiple Choice increase production by a larger amount than a firm with some monopoly power in its product market. increase production by a smaller amount than a firm with some monopoly power in its product market. decrease production by a larger amount than a firm with some monopoly power in its product market. decrease production by a smaller amount than a firm with some monopoly power in its product market.The widget market is competitive and includes no transaction costs. Five suppliers are willing to sell one widget at the following prices: $20, $12, $8, $4, and $2 (one seller at each price). Five buyers are willing to buy one widget at the following prices: $8, $12, $20, $32, and $44 (one buyer at each price). For each price shown in the following table, use the given information to enter the quantity demanded and quantity supplied. Price Quantity Demanded Quantity Supplied ($ per widget) (widgets) (widgets) $2 $4 $8 $12 $20 $32 $44 In this market, the equilibrium price will be______ per widget, and the equilibrium quantity will be ___ (#) widgets.The widget market is competitive and includes no transaction costs. Five suppliers are willing to sell one widget at the following prices: $26, $14, $10, $5, and $3 (one seller at each price). Five buyers are willing to buy one widget at the following prices: $10, $14, $26, $34, and $42 (one buyer at each price). For each price shown in the following table, use the given information to enter the quantity demanded and quantity supplied. Price Quantity Demanded Quantity Supplied ($ per widget) (widgets) (widgets) $3 $5 $10 $14 $26 $34 $42 In this market, the equilibrium price will be per widget, and the equilibrium quantity will be widgets.
- Exercises for Chapter 7 1. Recall exercise 1 from Chapter 5 in which an increase in the toll on a highway from $.40 to $.50 would reduce use of the highway by 5,000 cars per week. Because of the reduced use of the highway, demand in the secondary market for subway rides increases. Assuming that the price of subway rides is set equal to the marginal cost of operating the subway and marginal costs are constant (i.c., the supply schedule is horizontal), and no externalities result from the reduced use of the highway and the increased use of the subway, are there additional costs or benefits due to the inereased demand for subway rides? Why or why not? a. Because of the reduced use of the highway, demand in the secondary market for gasoline falls by 20,000 gallons per year. There is a stiff tax on gasoline, one that existed prior to the new toll. Assuming that the marginal cost of producing gasoline is $1 per gallon, that these marginal costs are constant (i.c., the supply schedule is…Rent controls force landlords to price apartments below the equilibrium price level. An immediate effect is a shortage (excess demand) of apartments, because the quantity of apartments demanded is greater than the quantity supplied at the regulated price. When cities prevent landlords from charging market rents, which of the following are common long-run outcomes? Check all that apply. The future supply of rental housing units increases. Efficient use of housing space results. Nonprice methods of rationing emerge. The quantity of available rental housing units falls. Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism. Answer completely and accurate answer. Rest assured, you will receive an upvote if the answer is accurate.Consider the market for Caribbean cruises. In the wake of the COVID-19 pandemic, the cruise companies take the following actions. First, they implement testing and tracing programs to limit the potential of COVID outbreaks on ships to occur and to spread. Second, they engage in widespread advertisement of their new and state of the art safety precautions. Using a generic model of supply and demand, show and describe how you would expect these initiatives would affect the market for cruises. Be sure to explain why which curves are shifting, and discuss changes to market equilibrium.
- The competitive advantage refers to factors that help businesses to produce goods or services effectively or at a lower cost than competitors. These factors also help businesses to increase sales revenue or higher margins than their competitors in the market. Everywhere in the world, competition in the hotel industry is fierce within strategic groups, depending on the level of industry growth. The competitive advantages for the 4-star hotel are as follows: 1. International travelers can be catered: International travel is becoming more popular. As the hotel has a staff who speaks multiple languages this means that managers can provide promotional materials and activity guides in a number of different languages. Multilingual employees will allow guests to communicate more clearly with them. They can also offer promotional materials and activity guides in a number of different languages. 2. Can provide spacious accommodations: The guests can select their rooms as per their…Rent controls force landlords to price apartments below the equilibrium price level. An immediate effect is a shortage (excess demand) of apartments, because the quantity of apartments demanded is greater than the quantity supplied at the regulated price. When cities prevent landlords from charging market rents, which of the following are common long-run outcomes? Check all that apply. The future supply of rental housing units increases. Efficient use of housing space results. Nonprice methods of rationing emerge. The quantity of available rental housing units falls. Step by step with explanation answer.Question 4 Which of the following is NOT a characteristic of a competitive market? Multiple Choice At least one of the producers has significant market power. Externalities do not exist in the market. There is free entry into the market. There are many buyers in the market.
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