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Given the following information for Firm B Profit maximizing the price of $1100; Consumer Surplus of 10000; Profit of $38000   Calculate the DWL?

Given the following information for Firm B Profit maximizing the price of $1100; Consumer Surplus of 10000; Profit of $38000   Calculate the DWL?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Given the following information for Firm B

Profit maximizing the price of $1100; Consumer Surplus of 10000; Profit of $38000  

Calculate the DWL?

Firm A Firm B Firm C Price where output is equal to zero (R) 2000 1500 60 Profit maximising price (R) 1000 ? 60 Profit maximising output level (units) 30 50 2500 MC at profit maximising output level (R) ? 275 60 ATC at profit maximising output level (R) 1300 ? 36 AVC at profit maximising output level (R) 900 300 ? Minimum ATC (R) 1200 320 30 Minimum AVC (R) 800 280 3 Price at allocative efficient output level (R) 160 580 ? Allocative efficient level of output (units) 150 200 2500 Lerner index 0.8 ? Total Fixed Cost (R) 2000 75000 Total Variable Cost at profit maximising output level (R) 27000 15000 ? Mark-up ? 4
Transcribed Image Text:Firm A Firm B Firm C Price where output is equal to zero (R) 2000 1500 60 Profit maximising price (R) 1000 ? 60 Profit maximising output level (units) 30 50 2500 MC at profit maximising output level (R) ? 275 60 ATC at profit maximising output level (R) 1300 ? 36 AVC at profit maximising output level (R) 900 300 ? Minimum ATC (R) 1200 320 30 Minimum AVC (R) 800 280 3 Price at allocative efficient output level (R) 160 580 ? Allocative efficient level of output (units) 150 200 2500 Lerner index 0.8 ? Total Fixed Cost (R) 2000 75000 Total Variable Cost at profit maximising output level (R) 27000 15000 ? Mark-up ? 4
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