Suppose that each firm in a competitive industry has the following costs: Total Cost: TC = 50+/q² Marginal Cost: MC = q where q is an individual firm's quantity produced. The market demand curve for this product is: Demand QD 160-4P where P is the price and is the total quantity of the good. Each firm's fixed cost is $ What is each firm's variable cost? O 50+ //q O q
Suppose that each firm in a competitive industry has the following costs: Total Cost: TC = 50+/q² Marginal Cost: MC = q where q is an individual firm's quantity produced. The market demand curve for this product is: Demand QD 160-4P where P is the price and is the total quantity of the good. Each firm's fixed cost is $ What is each firm's variable cost? O 50+ //q O q
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:53:06
The average total cost is at its minimum when the quantity each firm produces (q) equals
Which of the following represents the equation for each firm's supply curve in the short run?
120 - 19²
01/19²2
firm.)
q
In the long run, the firm will remain in the market and produce if
50-9
Currently, there are 6 firms in the market.
In the short run, in which the number of firms is fixed, the equilibrium price is $
and the total quantity produced in the market is
units. Each firm produces
units. (Hint: Total supply in the market equals the number of firms times the quantity supplied by each
are
In this equilibrium, each firm makes a profit of $
Firms have an incentive to
the market.
(Note: Enter a negative number if the firm is incurring a loss.)
In the long run, with free entry and exit, the equilibrium price is $
firms in the market, with each firm producing
units.
and the total quantity produced in the market is
units. There
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Transcribed Image Text:Suppose that each firm in a competitive industry has the following costs:
Total Cost:
Marginal Cost: MC = q
where q is an individual firm's quantity produced.
TC = 50+ 1/2q²
The market demand curve for this product is:
Demand QD 160 - 4P
=
where P is the price and is the total quantity of the good.
Each firm's fixed cost is $
What is each firm's variable cost?
50+ 1/29
1/79
1/79²
q
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