The fact accounting for unavailability of taxis on bad weather days before arrival of company U. Concept Introduction: Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

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Answer 1

Question

Chapter 3, Problem 1QFT

To determine

The fact accounting for unavailability of taxis on bad weather days before arrival of company U.

Concept Introduction:

Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

Expert Solution & Answer

Answer to Problem 1QFT

According to the given case, the market was highly competitive, as the price was not set by the taxi drivers and was set by regulators.

Explanation of Solution

The cab market in New York City was competitive before the arrival of Company U because the regulators set the price according to the demand and supply of the market and the taxi drivers follow these prices.

If the market is not competitive then the taxi drivers would have set their own prices and would not have followed the market price. Thus, there were many sellers and many buyers.

During the good weather condition, drivers anticipate that there would be high demand; therefore, enough cabs should be supplied.

Whereas, at bad weather, time drivers anticipate that there would be very low or even no demand; therefore, they reduce the supply by themselves.

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19. (20 points in total) Suppose that the market demand curve is p = 80 - 8Qd, where p is the price per unit and Qd is the number of units demanded per week, and the market supply curve is p = 5+7Qs, where Q5 is the quantity supplied per week. a. b. C. d. e. Calculate the equilibrium price and quantity for a competitive market in which there is no market failure. Draw a diagram that includes the demand and supply curves, the values of the vertical- axis intercepts, and the competitive equilibrium quantity and price. Label the curves, axes and areas. Calculate both the marginal willingness to pay and the total willingness to pay for the equilibrium quantity. Calculate both the marginal cost of the equilibrium quantity and variable cost of producing the equilibrium quantity. Calculate the total surplus. How is the value of total surplus related to your calculations in parts c and d?

Please answer all parts of the question

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Answer 2

Question

Chapter 3, Problem 1QFT

To determine

The fact accounting for unavailability of taxis on bad weather days before arrival of company U.

Concept Introduction:

Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

Expert Solution & Answer

Answer to Problem 1QFT

According to the given case, the market was highly competitive, as the price was not set by the taxi drivers and was set by regulators.

Explanation of Solution

The cab market in New York City was competitive before the arrival of Company U because the regulators set the price according to the demand and supply of the market and the taxi drivers follow these prices.

If the market is not competitive then the taxi drivers would have set their own prices and would not have followed the market price. Thus, there were many sellers and many buyers.

During the good weather condition, drivers anticipate that there would be high demand; therefore, enough cabs should be supplied.

Whereas, at bad weather, time drivers anticipate that there would be very low or even no demand; therefore, they reduce the supply by themselves.

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Answer 3

Question

Chapter 3, Problem 1QFT

To determine

The fact accounting for unavailability of taxis on bad weather days before arrival of company U.

Concept Introduction:

Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

Expert Solution & Answer

Answer to Problem 1QFT

According to the given case, the market was highly competitive, as the price was not set by the taxi drivers and was set by regulators.

Explanation of Solution

The cab market in New York City was competitive before the arrival of Company U because the regulators set the price according to the demand and supply of the market and the taxi drivers follow these prices.

If the market is not competitive then the taxi drivers would have set their own prices and would not have followed the market price. Thus, there were many sellers and many buyers.

During the good weather condition, drivers anticipate that there would be high demand; therefore, enough cabs should be supplied.

Whereas, at bad weather, time drivers anticipate that there would be very low or even no demand; therefore, they reduce the supply by themselves.

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Answer 4

Question

Chapter 3, Problem 1QFT

To determine

The fact accounting for unavailability of taxis on bad weather days before arrival of company U.

Concept Introduction:

Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

Expert Solution & Answer

Answer to Problem 1QFT

According to the given case, the market was highly competitive, as the price was not set by the taxi drivers and was set by regulators.

Explanation of Solution

The cab market in New York City was competitive before the arrival of Company U because the regulators set the price according to the demand and supply of the market and the taxi drivers follow these prices.

If the market is not competitive then the taxi drivers would have set their own prices and would not have followed the market price. Thus, there were many sellers and many buyers.

During the good weather condition, drivers anticipate that there would be high demand; therefore, enough cabs should be supplied.

Whereas, at bad weather, time drivers anticipate that there would be very low or even no demand; therefore, they reduce the supply by themselves.

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 3, Problem 1QFT

To determine

The fact accounting for unavailability of taxis on bad weather days before arrival of company U.

Concept Introduction:

Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

Expert Solution & Answer

Answer to Problem 1QFT

According to the given case, the market was highly competitive, as the price was not set by the taxi drivers and was set by regulators.

Explanation of Solution

The cab market in New York City was competitive before the arrival of Company U because the regulators set the price according to the demand and supply of the market and the taxi drivers follow these prices.

If the market is not competitive then the taxi drivers would have set their own prices and would not have followed the market price. Thus, there were many sellers and many buyers.

During the good weather condition, drivers anticipate that there would be high demand; therefore, enough cabs should be supplied.

Whereas, at bad weather, time drivers anticipate that there would be very low or even no demand; therefore, they reduce the supply by themselves.

Answer 6

Chapter 3, Problem 1QFT

To determine

The fact accounting for unavailability of taxis on bad weather days before arrival of company U.

Concept Introduction:

Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

Expert Solution & Answer

Answer to Problem 1QFT

According to the given case, the market was highly competitive, as the price was not set by the taxi drivers and was set by regulators.

Explanation of Solution

The cab market in New York City was competitive before the arrival of Company U because the regulators set the price according to the demand and supply of the market and the taxi drivers follow these prices.

If the market is not competitive then the taxi drivers would have set their own prices and would not have followed the market price. Thus, there were many sellers and many buyers.

During the good weather condition, drivers anticipate that there would be high demand; therefore, enough cabs should be supplied.

Whereas, at bad weather, time drivers anticipate that there would be very low or even no demand; therefore, they reduce the supply by themselves.

Answer 7

Chapter 3, Problem 1QFT

To determine

The fact accounting for unavailability of taxis on bad weather days before arrival of company U.

Concept Introduction:

Competitive Market: When many buyers and sellers interact with each other for their own incentive, it is referred to as a market. Price is determined by the demand and supply of the market.No single seller or single buyer can determine the price in the competitive market.

Answer 8

Expert Solution & Answer

Answer to Problem 1QFT

According to the given case, the market was highly competitive, as the price was not set by the taxi drivers and was set by regulators.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Explanation of Solution

The cab market in New York City was competitive before the arrival of Company U because the regulators set the price according to the demand and supply of the market and the taxi drivers follow these prices.

If the market is not competitive then the taxi drivers would have set their own prices and would not have followed the market price. Thus, there were many sellers and many buyers.

During the good weather condition, drivers anticipate that there would be high demand; therefore, enough cabs should be supplied.

Whereas, at bad weather, time drivers anticipate that there would be very low or even no demand; therefore, they reduce the supply by themselves.

Answer 12

Ch. 3 - Prob. 1QFT Ch. 3 - Prob. 2QFT Ch. 3 - Prob. 3QFT Ch. 3 - Prob. 1P Ch. 3 - Prob. 2P Ch. 3 - Prob. 3P Ch. 3 - Prob. 4P Ch. 3 - Prob. 5P Ch. 3 - Prob. 6P Ch. 3 - Prob. 7P

Answer to Problem 1QFT

Explanation of Solution

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Chapter 3 Solutions