A Transition to Advanced Mathematics
8th Edition
ISBN: 9781285463261
Author: Douglas Smith, Maurice Eggen, Richard St. Andre
Publisher: Cengage Learning
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Chapter 1.8, Problem 11E
To determine
To prove: a and
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Firm Alpha operates in a perfectly competitive market in a constant-cost industry and is earning negative economic profit.
a. How does Firm Alpha determine its profit-maximizing quantity of output? Explain.
b. Draw correctly labeled side-by-side graphs for Firm Alpha and the market it operates in. Label the axes and all of the following:
i. Market price (PE) and market quantity (QE)
ii. The firm's quantity of output (Qe)
iii. The firm's average total cost (ATC)
c. Completely shade the area of the firm's total cost.
d. Identify whether the following increase, decrease, or remain constant as the market moves to long-run equilibrium:
i. Market equilibrium quantity
ii. Market equilibrium price
e. Assume the product that Firm Alpha produces has a negative externality. Draw the marginal social cost (MSC) on the market graph from part (b).
f. Will the unregulated market produce more or less than the socially optimal quantity?
g. Label the socially optimal quantity (Qso) for the market on your…
Goods A, B, and C are related goods, each operating in a perfectly competitive market.
a. As the price of Good A increases from $8 to $10, its quantity demanded falls from 200 units to 160 units. Calculate the price elasticity of demand for this range.
b. Good A is an input for Good B. Illustrate the effect of the price change from part (a) on a fully labeled supply and demand graph for Good B. Label the equilibrium price(s) and quantity or quantities. Use arrows to indicate any shifts.
c. On your graph from (b), shade the consumer surplus lost in the market for Good B as a result of the change in part (a).
d. The equilibrium price for Good C is $2, and the equilibrium quantity is 60 units. The cross-price elasticity of Good C with Good A is -3.
i. Are Good C and Good A normal goods, inferior goods, complementary goods, or substitute goods?
ii. Calculate the new equilibrium quantity of Good C after a 25% price increase for Good A.
Price (S)
The graph below depicts a firm with market power. In the graph, MC represents the firm's marginal costs, ATC represents the average total costs, D represents demand, and MR represents marginal revenue.
110
70
60
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40
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20
MC
ATC
D
0
40
50
70
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95
Quantity/Units
MR
a. At 60 units of output, how much would this profit-maximizing monopolist charge?
b. How many units would it produce to maximize total revenue rather than total profit?
c. What is the maximum quantity this firm can produce without incurring economic losses?
d. Calculate the firm's profit at the profit-maximizing output and price.
e. Why is this firm's marginal revenue curve below its demand curve? Explain.
Chapter 1 Solutions
A Transition to Advanced Mathematics
Ch. 1.1 - Which of the following are propositions? Give the...Ch. 1.1 - For each pair of statements, determine whether the...Ch. 1.1 - Make a truth table for each of the following...Ch. 1.1 - If P, Q, and R are true while S and K are false,...Ch. 1.1 - Use truth tables to verify each part of Theorem...Ch. 1.1 - Which of the following pairs of propositional...Ch. 1.1 - Determine the propositional form and truth value...Ch. 1.1 - Suppose P, Q, and R are propositional forms....Ch. 1.1 - Suppose P, Q, S, and R are propositional forms, P...Ch. 1.1 - Use a truth table to determine whether each of the...
Ch. 1.1 - Give a useful denial of each statement. Assume...Ch. 1.1 - Restore parentheses to these abbreviated...Ch. 1.1 - Other logical connectives between two propositions...Ch. 1.1 - Other logical connectives between two propositions...Ch. 1.2 - Identify the antecedent and the consequent for...Ch. 1.2 - Prob. 2ECh. 1.2 - What can be said about the truth value of Q when...Ch. 1.2 - Identify the antecedent and the consequent for...Ch. 1.2 - Which of the following conditional sentences are...Ch. 1.2 - Which of the following are true? Assume that x and...Ch. 1.2 - Make truth tables for these propositional forms....Ch. 1.2 - Prove Theorem 1.2.2 by constructing truth tables...Ch. 1.2 - Determine whether each statement qualifies as a...Ch. 1.2 - Prob. 10ECh. 1.2 - Dictionaries indicate that the conditional meaning...Ch. 1.2 - Show that the following pairs of statements are...Ch. 1.2 - Prob. 13ECh. 1.2 - Give, if possible, an example of a false...Ch. 1.2 - Give the converse and contrapositive of each...Ch. 1.2 - Prob. 16ECh. 1.2 - The inverse, or opposite, of the conditional...Ch. 1.3 - Translate the following English sentences into...Ch. 1.3 - For each of the propositions in Exercise 1, write...Ch. 1.3 - Translate these definitions from the Appendix into...Ch. 1.3 - Prob. 4ECh. 1.3 - The sentence “People dislike taxes” might be...Ch. 1.3 - Let T={17},U={6},V={24} , and W={2,3,7,26} . In...Ch. 1.3 - (a) Complete the following proof of Theorem...Ch. 1.3 - Which of the following are true? The universe for...Ch. 1.3 - Give an English translation for each. The universe...Ch. 1.3 - Which of the following are true in the universe of...Ch. 1.3 - Let A(x) be an open sentence with variable x. (a)...Ch. 1.3 - Suppose the polynomials anxn+an1xn1+...+a0 and...Ch. 1.3 - Which of the following are denials of (!x)P(x) ?...Ch. 1.3 - Riddle: What is the English translation of the...Ch. 1.4 - Analyze the logical form of each of the following...Ch. 1.4 - A theorem of linear algebra states that if A andB...Ch. 1.4 - Verify that [(BM)L(ML)]B is a tautology. See the...Ch. 1.4 - These facts have been established at a crime...Ch. 1.4 - Prob. 5ECh. 1.4 - Let a and b be real numbers. Prove that (a)...Ch. 1.4 - Suppose a, b, c, and d are integers. Prove that...Ch. 1.4 - Give two proofs that if n is a natural number,...Ch. 1.4 - Let a, b, and c be integers and x, y, and z be...Ch. 1.4 - Recall that except for degenerate cases, the graph...Ch. 1.4 - Exercises throughout the text with this title ask...Ch. 1.5 - Analyze the logical form of each of the following...Ch. 1.5 - A theorem of linear algebra states that if A andB...Ch. 1.5 - Let x, y, and z be integers. Write a proof by...Ch. 1.5 - Write a proof by contraposition to show that for...Ch. 1.5 - A circle has center (2,4) . (a) Prove that (1,5)...Ch. 1.5 - Suppose a and b are positive integers. Write a...Ch. 1.5 - Prob. 7ECh. 1.5 - Prob. 8ECh. 1.5 - Prove by contradiction that if n is a natural...Ch. 1.5 - Prove that 5 is not a rational number.Ch. 1.5 - Three real numbers, x, y, and z, are chosen...Ch. 1.5 - Assign a grade of A (correct), C (partially...Ch. 1.6 - Prove that (a) there exist integers m and n such...Ch. 1.6 - Prove that for all integers a, b, and c, If...Ch. 1.6 - Prove that if every even natural number greater...Ch. 1.6 - Provide either a proof or a counterexample for...Ch. 1.6 - (a) Prove that the natural number x is prime if...Ch. 1.6 - Prove that (a) for every natural number n, 1n1 ....Ch. 1.6 - Starting at 9 a.m. on Monday, a hiker walked at a...Ch. 1.6 - Show by example that each of the following...Ch. 1.6 - Assign a grade of A (correct), C (partially...Ch. 1.7 - (a) Let a be a negative real number. Prove that if...Ch. 1.7 - Prob. 2ECh. 1.7 - Prove that (a) 5n2+3n+4 is even, for all integers...Ch. 1.7 - Prob. 4ECh. 1.7 - Prove that (a) if x + y is irrational, then either...Ch. 1.7 - Prob. 6ECh. 1.7 - Prob. 7ECh. 1.7 - Prob. 8ECh. 1.7 - Prob. 9ECh. 1.7 - Prob. 10ECh. 1.7 - Assign a grade of A (correct), C (partially...Ch. 1.8 - For each given pair a, b of integers, find the...Ch. 1.8 - Prob. 2ECh. 1.8 - Let a and b be integers, a0 , and ab . Prove that...Ch. 1.8 - Prob. 4ECh. 1.8 - Prob. 5ECh. 1.8 - Prob. 6ECh. 1.8 - Prob. 7ECh. 1.8 - Prob. 8ECh. 1.8 - Prove that for every prime p and for all natural...Ch. 1.8 - Let q be a natural number greater than 1 with the...Ch. 1.8 - Prob. 11ECh. 1.8 - Prob. 12ECh. 1.8 - Let a and b be nonzero integers that are...Ch. 1.8 - Let a and b be nonzero integers and d=gcd(a,b) ....Ch. 1.8 - Let a and b be nonzero integers and c be an...Ch. 1.8 - Prob. 16ECh. 1.8 - Prob. 17ECh. 1.8 - Let a and b be integers, and let m=lcm(a,b) . Use...Ch. 1.8 - The greatest common divisor of positive integers a...Ch. 1.8 - Prob. 20ECh. 1.8 - Prob. 21E
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