In the US cotton market, there are 500 identical competitive farms, each farm having the cost function C(q) = 162 +10q + 0.5q² where q is the quantity of cotton in tons produced by each farm. The market demand curve is given by Qd = 10,400 – 50p. (a) Calculate the market equilibrium price p*. (b) Suppose the government gives each farm a subsidy of $8 per ton. Calculate the long- run market price. (c) How many farmers will there be in the cotton market in the long run?

In the US cotton market, there are 500 identical competitive farms, each farm having the cost function C(q) = 162 +10q + 0.5q² where q is the quantity of cotton in tons produced by each farm. The market demand curve is given by Qd = 10,400 – 50p. (a) Calculate the market equilibrium price p*. (b) Suppose the government gives each farm a subsidy of $8 per ton. Calculate the long- run market price. (c) How many farmers will there be in the cotton market in the long run?

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

graph production cost increase and quantity decrease
What benefits are their in operating a business to consumer online business model for consumers and the owner?
Whats a problem customers face with LCD Panels Battery issues?
What is the unit contribution margin?
Why do some frozen pizzas cost more than others? Think generic versus name brand. Why would a customer opt to purchase a name brand pizza over a generic brand?
What are the ethical issues that could be encountered when running an e-commerce platform?
7. Identify and describe the stages in the adoption process.
coviD WORLD >AONG MY
Please find the value of a APS when APC is 0.44
How does the Internet help companies gain customer input on their existing and new products?
how did you get 30.205?
hi you have not specified how you got 1.152