2. Consider a competitive market where there are two types of firms, Type A and Type B, with total cost functions TC(q) = 2+4q+q² TCB (q) = 8+4q+6q² (a) Derive the short-run supply curve for each firm type (b) What is the short-run market supply, if there are 6 Type A firms, and 12 Type B firms? (c) What is total quantity produced when p=10? (d) How does your answer at (c) change if we consider long run supply rather than short run? Here, assume again that p=10 and that there are 6 Type A firms and 12 Type B firms.
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- Suppose that each firm in a competitive industry has the following costs: Total cost: TC = 50 + q2 Marginal cost: MC = q where q is an individual firms quantity produced. The market demand curve for this product is Demand:QD = 120 P where P is the price and Q is the total quantity of the good. Currently, there are 9 firms in the market. a. What is each firms fixed cost? What is its variable cost? Give the equation for average total cost. b. Graph average-total-cost curve and the marginal-cost curve for q from 5 to 15. At what quantity is average-total-cost curve at its minimum? What is marginal cost and average total cost at that quantity? c Give the equation for each firms supply curve. d. Give the equation for the market supply curve for the short run in which the number of firms is fixed. e. What is the equilibrium price and quantity for this market in the short run? f. In this equilibrium, how much does each firm produce? Calculate each firms profit or loss. Is there incentive for firms to enter or exit? g. In the long run with free entry and exit, what is the equilibrium price and quantity in this market? h. In this long-run equilibrium, how much does each firm produce? How many firms are in the market?17.A perfectly competitive firm has the following total cost function: TC = 4,500 + 2q + .0005q2 where TC is total cost in dollars and q is the quantity of output produced. a. Assume this perfectly competitive market consists of 800 firms with cost structures identical to the one above. What is the equation for the market supply curve? Assume the market demand curve is: Qd = 5,600,000 – 400,000P where Qd is the quantity demanded in the market and P is the commodity’s price in dollars. b. What is the market’s equilibrium price? c. Assuming the market is in equilibrium, using marginal revenue and marginal cost determine the firm’s profit-maximizing quantity of output? What does the profit-maximizing firm’s total economic profit equal? Assume the total cost function above: TC = 4,500 + 2q + .0005q2 is associated with the short-run total cost function that corresponds to the minimum point on the long-run average total cost curve and this is a constant cost industry. d. What would the…2. Consider a market with 90 firms, each firm has a short-run total cost function as follows: TC(q) = 5q2, and a marginal cost function: MC(q) = 10q. Market demand is given by equation Qd(p) = 200 - p. a) What is the fixed cost? Solve the average variable cost function in the short-run. b) What is the supply function of each firm? c) Solve for the short-run equilibrium outcome: P*, Q* and q*. d) What is one firm's economic profit in this market?
- 2. Consider a market with 90 firms, each firm has a short-run total cost function as follows: TC(q) = 5q2, and a marginal cost function: MC(q) = 10q. Market demand is given by equation Qd(p) = 200 - p. a. What is the fixed cost? Solve the average variable cost function in the short-run. b. What is the supply function of each firm? c. Solve for the short-run equilibrium outcome: P*, Q* and q*. d. What is one firm's economic profit in this market? e. Consider a different market structure, where there is only one firm, interpreted as a monopolist, and then critically discuss the impact on equilibrium price and quantity. Discuss total surplus for these two types of market structures.7. Short-run supply and long-run equilibrium Consider the competitive market for copper. Assume that, regardless of how many firms are in the industry, every firm in the industry is identical and faces the marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves shown on the following graph. The following diagram shows the market demand for copper. Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 10 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 15 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 20 firms. If there were 20 firms in this market, the short-run equilibrium price of copper would be ___ per…Suppose that each firm in a competitive industry has the following costs: Totalcost:TC=50+1/2q2 Marginalcost:MC=q where q is an individual firm's quantity produced. The market demand curve for this product is Demand:QD=120−P where P is the price and Q is the total quantity of the good. Currently, there are 9 firms in the market.1. Give the equation for the market supply curve for the short run in which the number of firms is fixed.2. What is the equilibrium price and quantity for this market in the short run?3. In this equilibrium, how much does each firm produce? Calculate each firm's profit or loss. Is there incentive for firms to enter or exit?4. In the long run with free entry and exit, what is the equilibrium price and quantity in this market?5. In this long-run equilibrium, how much does each firm produce? How many firms are in themarket?
- 9.- A competitive firm reaches the minimum of the long-run average cost for y = 20 when it operates with the short-run cost function C = yi3-20yi2 + 100yi + 8000, where yi is the production of the firm. Then the long-run price equilibrium will be 500. If the government imposes a specific tax on output of 40 euros, what are the taxes collected by the government in the short-run and in the long-run, if the market demand is given by x = 2500 - 3p, where x is the quantity demanded by consumers and p is the price? Will the government collect more or less taxes in the long-run than in the short-run? Why?Consider the market for electronic components ("chips") and assume that there is complete competition.1a) Graph the short-run market equilibrium in a supply-demand diagram. 1b) Due to entry restrictions, there are long waiting times and thus supply passports. Show what impact these supply bottlenecks have on the market for electric cars. For this purpose, graphically represent the situation with and without supply bottlenecks in a supply-demand diagram. Label the old and new market equilibrium as well as the new and old consumer and producer surplus. Be sure to include the necessary labels in your diagram. 1c) Since the effects on the market for electric cars related to the supply bottleneck are not desirable from a macroeconomic perspective, the government is considering intervening with economic policy measures. In your diagram from 1b), show why the effects addressed are not desirable from a macroeconomic perspective. Also explain this briefly in the text or annotated keywords.1d)…Consider in perfectly competitive market the following demand and supply equations for sugar:Qd =1000-1000p where Q d is quantity demanded and Qs is quantity supplied. Qs=800+ 1000p Where P is the price of sugar per pound and Q is thousands of pounds of sugar. (a) Suppose that the government wishes to subsidize sugar production by placing a floor on sugar prices of $0.20 per pound. What would be the relationship between the quantity supplied and quantity demand for sugar?(b) Identify market problem specifically at prices 0.2 per pound and what will be scientific recommendation you suggest to solve the identified market problem?
- Suppose that each firm in a competitive industry has the following as the Total cost: TC=50+ ½q2 Where q is an individual firm’s quantity produced. The market demand curve for this product is Demand: Q = 120 – P Where P is the price and Q is the total quantity of the good. Currently, there are 9 firms in the market What is each firm’s fixed cost? What is its variable cost? At what quantity efficiency of scale would be achieved? Give the equation for each firm’s supply curve Give the equation for the market supply curve for the short run What is the equilibrium price and quantity for this market in the short run? In this equilibrium, how much does each firm produce? Is there incentive for firms to enter or exit? In the long run with free entry and exit, what is the equilibrium price and quantity in this market? In the long-run equilibrium, how many firms are in the market?Suppose that each firm in a competitive industry has the following as the Total cost: TC=50+ ½q2 Where q is an individual firm’s quantity produced. The market demand curve for this product is Demand: Q = 120 – P Where P is the price and Q is the total quantity of the good. Currently, there are 9 firms in the market What is each firm’s fixed cost? What is its variable cost? At what quantity efficiency of scale would be achieved? Give the equation for each firm’s supply curve Give the equation for the market supply curve for the short run What is the equilibrium price and quantity for this market in the short run? In this equilibrium, how much does each firm produce? Is there incentive for firms to enter or exit? In the long run with free entry and exit, what is the equilibrium price and quantity in this market? In the long-run equilibrium, how many firms are in the market? I want the subparts 4,5,6 to be solved. Thank youThe handmade snuffbox industry is composed of 100 identical firms each having short-run total costs given by , where q is the output per day.20.5105STCqq=++(a) What is the short-run supply curve for each firm? What is the short-run supply curve for the market?(b) Suppose the demand is given by . What will be the equilibrium (both quantity and 110050QP=-price) in this marketplace? (c) What will each firm’s short-run profits be?
