Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Question
Chapter 15, Problem 7SPPA
To determine
The quantity which Lin will produce and the firm's economic profit, and whether the firm will exit or enter into the market along with the long run economic profit is to be estimated.
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At a market price of $83 a batch, what quantity does Lin’s produce and what is the firm’s economic profit in the short run? Do firms enter or exit the market and what is Lin’s economic profit in the long run?
The situation facing by firm "Smart", a producer of running shoes, is shown in the
following figure.
100
MC
ATC
80
60
40
20
MR
50
100
150
200
Quantity (pairs of running shoes per week)
a. What quantity does Smart Shoes produce?
Answer:
b. What is the price of a pair of Smart shoes?
Answer:
c. What is Smart's economic profit or economic loss?
Answer:
Why MR curve is below to demand curve
Price and cost (dollars per pair)
8
Next question ice and cost (dolars per par)
The graph shows the long-run situation facing a producer of running shoes.
In the market for running shoes, all the firms face a similar demand curve and have similar cost curves
120-
Draw a vertical arrow that shows the firm's markup at the profi-maximizing quantity. Label R.
MC
t004
What is a fim's markup?
/ATC
A fem'u markup is the amount by which
exceeds
OA price; average total cost
60
OB. price, marginal cost
OC. average total cost marginal revenue
OD. average total cost marginal cost
20-
Describe the market of a firm in perfect competition
MR
O 25 7 100 1is e ths 200 zis
Quantity (pain of shoes per week)
A firm in perfect competition has
OA a markup similar to a firm in monopolistic competition
OB. no markup
> Draw only the objects specfied in the question
Oc. a negative markup
O D. a markkup similar to a monopoly
Chapter 15 Solutions
Foundations of Economics (8th Edition)
Ch. 15 - Prob. 1SPPACh. 15 - Prob. 2SPPACh. 15 - Prob. 3SPPACh. 15 - Prob. 4SPPACh. 15 - Prob. 5SPPACh. 15 - Prob. 6SPPACh. 15 - Prob. 7SPPACh. 15 - Prob. 8SPPACh. 15 - Prob. 9SPPACh. 15 - Prob. 10SPPA
Ch. 15 - Prob. 11SPPACh. 15 - Prob. 1IAPACh. 15 - Prob. 2IAPACh. 15 - Prob. 3IAPACh. 15 - Prob. 4IAPACh. 15 - Prob. 5IAPACh. 15 - Prob. 6IAPACh. 15 - Prob. 7IAPACh. 15 - Prob. 8IAPACh. 15 - Prob. 9IAPACh. 15 - Prob. 10IAPACh. 15 - Prob. 11IAPACh. 15 - Prob. 1MCQCh. 15 - Prob. 2MCQCh. 15 - Prob. 3MCQCh. 15 - Prob. 4MCQCh. 15 - Prob. 5MCQCh. 15 - Prob. 6MCQCh. 15 - Prob. 7MCQCh. 15 - Prob. 8MCQ
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