Profit maximization by all the businesses in Company U.

Question

Want to see more full solutions like this?

Answer 1

Question

Definition Video Formula Definition Phenomenon in which market supply and demand balance each other. Market equilibrium is the economic state in which the market demand curve intersects the market supply curve, giving us the equilibrium price and equilibrium quantity for which a commodity can be sold and purchased in an economy. When market equilibrium is achieved, it suggests that all resources have been allocated efficiently and that there is just a distribution of income and resources in the economy. Video Formula

Chapter 16, Problem 1QE

To determine

Profit maximization by all the businesses in Company U.

Expert Solution & Answer

Explanation of Solution

The profit is the excess revenue made by the firm after deducting the total cost of production from the total revenue made by the firm through the sale of the goods and services in the market. The firms in the imperfectly competitive market will be attracted toward the maximization of the profit in the market and thus, they would work toward the actions that maximize the profits for the businesses.

Even though the main objective of every firm under the imperfectly competitive market is to maximize their profit, the firms cannot always work for maximizing their profits in the US economy. There are many internal monitoring issues with every firm and these internal monitoring issues make the managers of the firm to look away from the profit maximization principle and might waste the profit potential on high priced benefits for themselves, which leads to the inefficiency in the production. When the inefficiency increases above the market limit, the firm might go out of business due to the loss. Thus, it is not necessary that the businesses in the US would always maximize their profit in the US economy.

Economics Concept Introduction

Market equilibrium: The market equilibrium is obtained at the point where the market demand equals with the market supply in the economy. There will be no excess or shortage in the economy when the economy is in its equilibrium.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Short Description Fiscal Policy Graph Details Shown is a Fiscal Policy diagram with the variable Real GDP (billions of dollars) on the x-axis and the variable Price Level on the y-axis. The x-axis is scaled from 0 to 800 billion dollars with an increment of 40 billion dollars, and the y-axis is scaled from 30 to 150 units with an increment of 5 units. Object Details On the graph we have:Four Line Objects:An upward sloping Aggregate Supply, AS line with two endpoints:Point 1 at (160, 70)Point 2 at (720, 140)A downward sloping Aggregate Demand, AD1 line with two endpoints:Point 1 at (80, 110)Point 2 at (640, 40)A vertical Long-run Aggregate Supply, LRAS with two endpoints:Point 1 at (400, 145)Point 2 at (400, 30)A downward sloping Aggregate Demand, AD line with two endpoints:Point 1 at (720, 60)Point 2 at (160, 130)Two Reference Points:Lines AS, AD, and LRAS intersect at (400, 100)Lines AS and AD1 intersect at (280, 85) a. How much does aggregate demand need to change to restore the…

Fiscal Policy Graph Details Shown is a Fiscal Policy diagram with the variable Real GDP (billions of dollars) on the x-axis and the variable Price Level on the y-axis. The x-axis is scaled from 0 to 1000 billion dollars with an increment of 50 billion dollars, and the y-axis is scaled from 0 to 180 units with an increment of 10 units. Object Details On the graph we have:Four Line Objects:An upward sloping Aggregate Supply, AS line with two endpoints:Point 1 at (200, 40)Point 2 at (800, 160)A downward sloping Aggregate Demand, AD line with two endpoints:Point 1 at (200, 160)Point 2 at (800, 40)A downward sloping Aggregate Demand, AD1 line with two endpoints:Point 1 at (350, 170)Point 2 at (900, 60)A vertical Long-run Aggregate Supply, LRAS line with two endpoints:Point 1 at (500, 170)Point 2 at (500, 0)Two Reference Points:Lines AS and AD1 intersect at (600, 120)Lines AS, AD, and LRAS intersect at (500, 100) a. How much does aggregate demand need to change to restore the…

a. How much does aggregate demand need to change to restore the economy to its long-run equilibrium? $ billion b. If the MPC is 0.6, how much does government purchases need to change to shift aggregate demand by the amount you found in part a? $ billion Suppose instead that the MPC is 0.95. c. How much does aggregate demand and government purchases need to change to restore the economy to its long-run equilibrium? Aggregate demand needs to change by $ billion and government purchases need to change by $ billion.

Answer 2

Question

Definition Video Formula Definition Phenomenon in which market supply and demand balance each other. Market equilibrium is the economic state in which the market demand curve intersects the market supply curve, giving us the equilibrium price and equilibrium quantity for which a commodity can be sold and purchased in an economy. When market equilibrium is achieved, it suggests that all resources have been allocated efficiently and that there is just a distribution of income and resources in the economy. Video Formula

Chapter 16, Problem 1QE

To determine

Profit maximization by all the businesses in Company U.

Expert Solution & Answer

Explanation of Solution

The profit is the excess revenue made by the firm after deducting the total cost of production from the total revenue made by the firm through the sale of the goods and services in the market. The firms in the imperfectly competitive market will be attracted toward the maximization of the profit in the market and thus, they would work toward the actions that maximize the profits for the businesses.

Even though the main objective of every firm under the imperfectly competitive market is to maximize their profit, the firms cannot always work for maximizing their profits in the US economy. There are many internal monitoring issues with every firm and these internal monitoring issues make the managers of the firm to look away from the profit maximization principle and might waste the profit potential on high priced benefits for themselves, which leads to the inefficiency in the production. When the inefficiency increases above the market limit, the firm might go out of business due to the loss. Thus, it is not necessary that the businesses in the US would always maximize their profit in the US economy.

Economics Concept Introduction

Market equilibrium: The market equilibrium is obtained at the point where the market demand equals with the market supply in the economy. There will be no excess or shortage in the economy when the economy is in its equilibrium.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Definition Video Formula Definition Phenomenon in which market supply and demand balance each other. Market equilibrium is the economic state in which the market demand curve intersects the market supply curve, giving us the equilibrium price and equilibrium quantity for which a commodity can be sold and purchased in an economy. When market equilibrium is achieved, it suggests that all resources have been allocated efficiently and that there is just a distribution of income and resources in the economy. Video Formula

Chapter 16, Problem 1QE

To determine

Profit maximization by all the businesses in Company U.

Expert Solution & Answer

Explanation of Solution

The profit is the excess revenue made by the firm after deducting the total cost of production from the total revenue made by the firm through the sale of the goods and services in the market. The firms in the imperfectly competitive market will be attracted toward the maximization of the profit in the market and thus, they would work toward the actions that maximize the profits for the businesses.

Even though the main objective of every firm under the imperfectly competitive market is to maximize their profit, the firms cannot always work for maximizing their profits in the US economy. There are many internal monitoring issues with every firm and these internal monitoring issues make the managers of the firm to look away from the profit maximization principle and might waste the profit potential on high priced benefits for themselves, which leads to the inefficiency in the production. When the inefficiency increases above the market limit, the firm might go out of business due to the loss. Thus, it is not necessary that the businesses in the US would always maximize their profit in the US economy.

Economics Concept Introduction

Market equilibrium: The market equilibrium is obtained at the point where the market demand equals with the market supply in the economy. There will be no excess or shortage in the economy when the economy is in its equilibrium.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Definition Video Formula Definition Phenomenon in which market supply and demand balance each other. Market equilibrium is the economic state in which the market demand curve intersects the market supply curve, giving us the equilibrium price and equilibrium quantity for which a commodity can be sold and purchased in an economy. When market equilibrium is achieved, it suggests that all resources have been allocated efficiently and that there is just a distribution of income and resources in the economy. Video Formula

Chapter 16, Problem 1QE

To determine

Profit maximization by all the businesses in Company U.

Expert Solution & Answer

Explanation of Solution

The profit is the excess revenue made by the firm after deducting the total cost of production from the total revenue made by the firm through the sale of the goods and services in the market. The firms in the imperfectly competitive market will be attracted toward the maximization of the profit in the market and thus, they would work toward the actions that maximize the profits for the businesses.

Even though the main objective of every firm under the imperfectly competitive market is to maximize their profit, the firms cannot always work for maximizing their profits in the US economy. There are many internal monitoring issues with every firm and these internal monitoring issues make the managers of the firm to look away from the profit maximization principle and might waste the profit potential on high priced benefits for themselves, which leads to the inefficiency in the production. When the inefficiency increases above the market limit, the firm might go out of business due to the loss. Thus, it is not necessary that the businesses in the US would always maximize their profit in the US economy.

Economics Concept Introduction

Market equilibrium: The market equilibrium is obtained at the point where the market demand equals with the market supply in the economy. There will be no excess or shortage in the economy when the economy is in its equilibrium.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 16, Problem 1QE

To determine

Profit maximization by all the businesses in Company U.

Expert Solution & Answer

Explanation of Solution

The profit is the excess revenue made by the firm after deducting the total cost of production from the total revenue made by the firm through the sale of the goods and services in the market. The firms in the imperfectly competitive market will be attracted toward the maximization of the profit in the market and thus, they would work toward the actions that maximize the profits for the businesses.

Even though the main objective of every firm under the imperfectly competitive market is to maximize their profit, the firms cannot always work for maximizing their profits in the US economy. There are many internal monitoring issues with every firm and these internal monitoring issues make the managers of the firm to look away from the profit maximization principle and might waste the profit potential on high priced benefits for themselves, which leads to the inefficiency in the production. When the inefficiency increases above the market limit, the firm might go out of business due to the loss. Thus, it is not necessary that the businesses in the US would always maximize their profit in the US economy.

Economics Concept Introduction

Market equilibrium: The market equilibrium is obtained at the point where the market demand equals with the market supply in the economy. There will be no excess or shortage in the economy when the economy is in its equilibrium.

Answer 6

Chapter 16, Problem 1QE

To determine

Profit maximization by all the businesses in Company U.

Expert Solution & Answer

Explanation of Solution

The profit is the excess revenue made by the firm after deducting the total cost of production from the total revenue made by the firm through the sale of the goods and services in the market. The firms in the imperfectly competitive market will be attracted toward the maximization of the profit in the market and thus, they would work toward the actions that maximize the profits for the businesses.

Even though the main objective of every firm under the imperfectly competitive market is to maximize their profit, the firms cannot always work for maximizing their profits in the US economy. There are many internal monitoring issues with every firm and these internal monitoring issues make the managers of the firm to look away from the profit maximization principle and might waste the profit potential on high priced benefits for themselves, which leads to the inefficiency in the production. When the inefficiency increases above the market limit, the firm might go out of business due to the loss. Thus, it is not necessary that the businesses in the US would always maximize their profit in the US economy.

Economics Concept Introduction

Market equilibrium: The market equilibrium is obtained at the point where the market demand equals with the market supply in the economy. There will be no excess or shortage in the economy when the economy is in its equilibrium.

Answer 7

Chapter 16, Problem 1QE

To determine

Profit maximization by all the businesses in Company U.

Answer 8

Expert Solution & Answer

Explanation of Solution

The profit is the excess revenue made by the firm after deducting the total cost of production from the total revenue made by the firm through the sale of the goods and services in the market. The firms in the imperfectly competitive market will be attracted toward the maximization of the profit in the market and thus, they would work toward the actions that maximize the profits for the businesses.

Even though the main objective of every firm under the imperfectly competitive market is to maximize their profit, the firms cannot always work for maximizing their profits in the US economy. There are many internal monitoring issues with every firm and these internal monitoring issues make the managers of the firm to look away from the profit maximization principle and might waste the profit potential on high priced benefits for themselves, which leads to the inefficiency in the production. When the inefficiency increases above the market limit, the firm might go out of business due to the loss. Thus, it is not necessary that the businesses in the US would always maximize their profit in the US economy.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Market equilibrium: The market equilibrium is obtained at the point where the market demand equals with the market supply in the economy. There will be no excess or shortage in the economy when the economy is in its equilibrium.

Answer 12

Ch. 16.1 - Prob. 1Q Ch. 16.1 - Prob. 2Q Ch. 16.1 - Prob. 3Q Ch. 16.1 - Prob. 4Q Ch. 16.1 - Prob. 5Q Ch. 16.1 - Prob. 6Q Ch. 16.1 - Prob. 7Q Ch. 16.1 - Prob. 8Q Ch. 16.1 - Prob. 9Q Ch. 16.1 - Prob. 10Q

Profit maximization by all the businesses in Company U.

Profit maximization by all the businesses in Company U.

Explanation of Solution

Want to see more full solutions like this?

Chapter 16 Solutions