11: For parts (1)-(3), suppose the market for hibiscus plants is perfectly competitive and the long-run cost for hibiscus plants for any firm in this market is C(q) = 70q – 20q² + 2q³ The market demand for hibiscus plants is given by the function D(p) = 30 -
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What is the long-run market supply curve for hibiscus plants? Graph it.
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- Suppose that a firm’s fixed costs is $80, and variable costs per unit are $(2Q + 16). The demand function for its product is given as:2Q + P = 54Determine its break-even point (Hint; At Break-even, revenue equal cost)QUESTION 19 Suppose a firm's inverse demand curve is given by P = 340 - 0.80 and its cost function is C = 120 + 100Q, then the production (Q) that maximizes profit is equal to: Or Q = 150 Or Q=250 EITHER Q=100 Q=200q 53 Suppose jumbo packs of notepads are sold in a perfectly competitive market for 60. To produce jumbo packs of notepads, an individual firm has a cost function of C = 2 + Q2. What is the firm’s profit? a. 798 b 698 c 898 d 998
- A firm's demand function is Q = 16 – P and its total cost function is defined as TC = 3 + Q + 0.25Q2. Use these two functions to form the firm's profit function and then determine the level of output that yields the profit maximum. What is the level of profit at the optimum? Note: MC = 1 + 0.5QThe market determined price in a perfectly competitive industry is P = Rs. 10. Suppose that the total cost equation of an individual firm in the industry is given by the expressionTC 1000+2Q+0.01Q2 At profit maximizing level what is firm total cost, total revenue and marginal costSuppose that the manager of a firm operating in a competitive market has estimated the firm’s average variable cost function to be AVC = 10 – 0.03Q + 0.00005Q2, TFC = 60. What is the MC function? What is the output where AVC is minimum? What is the optimum profit?
- Suppose that each firm in a competitive pizza market has the following identical cost: Total cost: TC=25+1.5Q2 The market demand function for the pizza market in the above question 2(a) is: Q= 120-P, where P is the price and Q is the total quantity of the pizza. Currently, there are 12 firms in the market. i. Formulate the equation or level of fixed cost, variable cost, marginal cost, average variable cost (AVC) and average total cost (ATC) for each firm. ii. Formulate each firm’s supply function based on the cost information prior to innovation and determine the market supply function in the short run. The total number of firms in the market is assumed to be fixed. iii. Calculate the price and quantity of pizza in the market and the quantity produced by each firm while the market is at the short-run equilibrium. Use a diagram to illustrate this short-run equilibrium and calculate each firm’s profit or loss. Discuss whether each firm has an incentive to leave or stay in the market.…A profit-maximizing firm in a competitive market is currently producing 100 units of output. It has average revenue of $10, average total cost of $8, and fixed cost of $200.a). Is the efficient scale of the firm more than, less than, or exactly 100 units?Q 1. (B) A firm's demand function is Q = 16 - P and its total cost function is defined as TC = 3 + Q + 0.25Q2 Use these two functions to form the firm's profit function and then determine the level of output that yields the profit maximum. What is the level of profit at the optimum?
- Suppose that the firm operates in a perfectly competitive market. The market price of his product is$10. The firm estimates its cost of production with the following cost function: TC=10q-4q2+q3 A. What level of out put should the firm produce to maximize its profit? B. Determine the level of profit at equilibrium. C. What minimum price is required by the firm to stay in the market?A firm has a linear demand function for it's product.When the price of the product is sh.20,the quantity demanded is 40 units.When the price increases to sh.240 the quantity demanded becomes 30 units.In addition,the firm's marginal cost function is giving by: Mc = 40q- 2q^2+2 Fixed cost = 5 million Where q= quantity demanded,Mc = marginal cost(sh.million) Required 1.The level of output that maximises profits 2.The maximum profit 3.The price of the product at the maximum profitA firm has a linear demand function for it's product.When the price for the product is Sh.220,the quantity demanded is 40 units.When the price increases to Sh.240 the quantity demanded becomes 30 units.In addition,the firm's marginal cost function is given by; MC = 40Q-2Q^2+2 Fixed cost = Sh. 5 million Where Q= quantity demanded, Mc= marginal cost(cost in Sh. Million) Required 1.The level of output that maximises profits 2.The maximum profit 3.The price of the product at a maximum profit