ECON MICRO (with ECON MICRO Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
5th Edition
ISBN: 9781305631946
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 20, Problem 4.7P
To determine
The managed float system and its benefits over the freely floating exchange rate system.
Concept Introduction:
The method by which the currency of a country is regulated by its authority in accordance with other countries currencies and foreign exchange markets is known as Exchange rate regime. Many standards of exchange rates have prevailed thus far in the world economy such as gold standard, Bretton-Wood standard and currently the managed float standard.
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Students have asked these similar questions
P2
P₁
$ per unit
Using the graph below, determine which statement is TRUE.
MC1
SRATC₁
Q1
Q₂
MC2 SRATC2
LRAC
✓ LEA
Quantity
Using the grapns below, wnicn snow the snort-run cost curves for 3 perfectly competitive firms in the same industry, determine whether the industry is in long-run equilibrium or not.
Q
Q
Firm A
QA
MC
ATC
Output
Firm B
QB
MC
ATC
Firm C
MC
ATC
Output
Output
Qc
If Firms A, B and C are in the same industry, is this industry in long-run equilibrium?
○ A. Yes, because P = MC = MR for each of the 3 firms.
○ B. No, because Firm A is not producing at a profit-maximizing level of output.
○ C. Yes, because all 3 firms are producing at their minimum average total cost.
OD. The answer is uncertain since it's unknown whether the firms are producing at the minimum efficient scale or not.
○ E. No, because if the industry were in equilibrium, all 3 firms would be earning zero economic profits.
Consider the table on the right, which shows the various
revenue concepts for a perfectly competitive firm.
Suppose the firm faces a constant market price of $4.
Compute first total revenue for each level of output and fill
in the TR column of the table. Next, compute marginal
revenue for each level of output and fill in the MR column
of the table.
(Marginal revenue at each level of output is computed
using total revenue for two successive levels of output.
For example, marginal revenue at 160 uses total revenue
for output levels 120 and 160.)
Total
Marginal
Price (p)Quantity (Q) Revenue (TR)Revenue (MR)
$4
A
EA
120
$4
160
$4
200
$4
240
$4
280
$
EA EA EA
10
S
ค
Chapter 20 Solutions
ECON MICRO (with ECON MICRO Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
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