he market for calculators in the city of Lefke is competitive and has the following demand chedule: $3 Quantity demanded Price 4. 5.7 10 11 250 7. 1050 950 650 550 852 Each producer in the maitet has fixed costs of $16 and average variable costs as follows: VÇ 750 450 350 AVC TC MC ATC $1 2. 4 3 4. 10 5. 12 6. a. Compute each producer's variable cost, total cost, marginal cost and average total cost b. On the same diagram draw the average variable cost, the marginal cost and the average variable cost curves (label them AVC, MC and ATC respectively) c. Show the supply curve of the firm on the above graph.
he market for calculators in the city of Lefke is competitive and has the following demand chedule: $3 Quantity demanded Price 4. 5.7 10 11 250 7. 1050 950 650 550 852 Each producer in the maitet has fixed costs of $16 and average variable costs as follows: VÇ 750 450 350 AVC TC MC ATC $1 2. 4 3 4. 10 5. 12 6. a. Compute each producer's variable cost, total cost, marginal cost and average total cost b. On the same diagram draw the average variable cost, the marginal cost and the average variable cost curves (label them AVC, MC and ATC respectively) c. Show the supply curve of the firm on the above graph.
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter3: Economic Decision Makers
Section: Chapter Questions
Problem 7QFR
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Question 3.
"he market for calculators in the city of Lefke is competitive and has the following demand
chedule:
Price
Quantity demanded
5.7
$3
4
1050
11
250
Bach producer in the matet has fixed costs of $16 and average variable costs as follows:
6
10
950
852
750
650
550
450
350
Q
AVC
VC
TC
MC
ATC
2
$1
4
2.
10
12
6
a. Compute each producer's variable cost, total cost, marginal cost and average total cost
b. On the same diagram draw the average variable cost, the marginal cost and the average
variable cost curves (label them AVC, MC and ATC respectively)
c. Show the supply curve of the firm on the above graph.
d. What is the shut-down price? How much is the amount of loss at that price?
e. The price for calculator is now $9. How many calculators are sold in the market? How many
calculators does each firm produce? How many producers are there? How much profit does each
firm earn?
f. Is the situation described in part a long-run equilibrium? Why or why not?
g. Suppose that in the long run there is free entry and exit. How much profit does each firm eam
in the long-run equilibrium? What are the market price and the number of calculators each firm
produce? How many calculators are sold in the market? How many producers are there?
w
ASUS](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd1ebedf7-b82b-4243-ac49-a2adc9cf4b21%2F7fcc375e-944b-41f9-9a16-a863b36ff0d2%2F68j2w3_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Extra exercises (5) [Compatibility Mode] - Word (Product Activation Failed)
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Title
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Question 3.
"he market for calculators in the city of Lefke is competitive and has the following demand
chedule:
Price
Quantity demanded
5.7
$3
4
1050
11
250
Bach producer in the matet has fixed costs of $16 and average variable costs as follows:
6
10
950
852
750
650
550
450
350
Q
AVC
VC
TC
MC
ATC
2
$1
4
2.
10
12
6
a. Compute each producer's variable cost, total cost, marginal cost and average total cost
b. On the same diagram draw the average variable cost, the marginal cost and the average
variable cost curves (label them AVC, MC and ATC respectively)
c. Show the supply curve of the firm on the above graph.
d. What is the shut-down price? How much is the amount of loss at that price?
e. The price for calculator is now $9. How many calculators are sold in the market? How many
calculators does each firm produce? How many producers are there? How much profit does each
firm earn?
f. Is the situation described in part a long-run equilibrium? Why or why not?
g. Suppose that in the long run there is free entry and exit. How much profit does each firm eam
in the long-run equilibrium? What are the market price and the number of calculators each firm
produce? How many calculators are sold in the market? How many producers are there?
w
ASUS
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