estion 5 Assume the wool industry is perfectly competitive. Why is it difficult for a wool producer to make excess profits in the long run? the fact that wool producers are "price takers' the assumption that wool producers in the industry do not "differentiate their products the fact that the demand curve facing each wool producer is perfectly elastic There is nearly free entry into the wool industry.

estion 5 Assume the wool industry is perfectly competitive. Why is it difficult for a wool producer to make excess profits in the long run? the fact that wool producers are "price takers' the assumption that wool producers in the industry do not "differentiate their products the fact that the demand curve facing each wool producer is perfectly elastic There is nearly free entry into the wool industry.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

2. Calculating marginal revenue from a linear demand curve The blue curve on the following graph represents the demand curve facing a firm that can set its own prices. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. Market for Goods Quantity Demanded (Units) Demand Price (Dollars per unit) On the graph input tool, change the number found in the Quantity Demanded field to determine the prices that correspond to the production of 0, 8, 16, 20, 24, 32, and 40 units of output. Calculate the total revenue for each of these production levels. Then, on the following graph, use the green points (triangle symbol) to plot the results. Calculate the total revenue if the firm produces 8 versus 7…
P $35 $30 $25 $20 $15 $10 $5 $0 5 10 (FIRM) 17 18 20 ATC JAVC F 9 $35 $30 $25 $20 $15 $10 $5 $0 (MARKET) X Consider the perfectly competitive market depicted in the graphs. Assuming the market is in equilibrium, what should this firm do? lay off workers temporarily in the short run keep producing in the short run leave the market permanently in the long run shut down temporarily in the short run
D, E nad F
(Figure: Profit-Maximization for Fabulous Finn's Flower Firm in the Short Run) Use Figure: Profit-Maximization for Fabulous Finn's Flower Firm in the Short Run. If the market price is Pa: Price, ATC, AVC, and MC (per unit) P2 91 92 9 Quantity (per perlod) firms will leave the industry, and the price will fall in the long run. there will be economic profits, and firms will enter the industry in the long run. the market supply curve will shift to the left, and price will fall in the long run. O the firm will produce q4 O O
Question 14 Figure 1 Use this figure for questions 14-20. This figure shows costs for a firm in a perfectly competitive market. Price MC 175 ATC AVC 125 100 80 270 322 515 Quantity Referring to Figure 1, suppose the price of the good is $175. If the firm produces and sells 515 units of output, its total revenue is (leave out the dollar sign)
13. The firm Wright Co. is a price taker because OWright Co. holds a very small share of the total market OWright Co. can influence the market price OWright Co. controls the price of their product OWright Co. can garantee a certain level of profit
19 Market Representative Firm MC i of A $7 a MR = P АТС b $5 AVC $2 D1 18,000 70 100 115 Quantity (Q) Output (Q) The diagram above shows a Perfectly Competitive market on the left, and a representative firm supplying in that market on the right. If the entry of new firms into the market caused the equilibrium Price to decrease to $5, the representative firm would: Select one: а. earn a positive Economic Profit. b. earn a negative Economic Profit. c. shut down in the short-run. d. earn zero Economic Profit. Price $$$
Calculate the consumer surplus if the industry is perfectly competitive according to this diagram in the image.
$11.00 MC| $10.00 $9.00 ATC $8.00 $7.00 TRAVCI $6.00 $5.00 $4.00 $3.00 2 3 7 9 10 Quantity of Output (q) Pierre is a photographer in a perfectly competitive market. The graph shown above gives his MC, ATC and AVC curves. Suppose the market price is $10.50. How much profit does Pierre make? 22.5 24 20 O18 S per unit
Fa 3. What is the HHI in the search engine market if Google has 67% market share, Bing has 18% market share, Yahoo! has 11% market share, Ask has 3% market Spri share, and AOL has 1% market share? Fa 2. A strongly competitive market is characterized by a HHI of Spri Greater than 1,000 Less than 2,400 Less than 1,000 Zero Fa 1,877 4,489 9,998 4,944 5. Looking at the typical Kinked Demand Curve, why are most Oligopoly firms reluctant to increase the price of their product on their own? Spri increase would lead to a lower total revenue. They would be then exposed to an inelastic demand for their product and the pric They would be theri exposed to an elastic demand for their product and the price increase would lead to a increase total revenue. They would be then exposed to an elastic demand for their product and the price increase would lead to a lower total revenue. No Oligopoly is reluctant to increase price
None
s 1, 12 & 13 Assignment Saved Help Save & Exit Assume a purely competitive increasing-cost industry is in long-run equilibrium. If a decline in demand occurs, firms will Multiple Choice leave the industry, price will fall, and quantity produced will rise. enter the industry and price and quantity will both rise. leave the industry and price and quantity will both rise. leave the industry, price will fall, and quantity produced will fall.