2., Consider the market for wheat, which is approximately perfectly competitive. The d.) How much profit will wheat famms earn when this market is in long-run equilibrium? Why? average total cost of the typical wheat farm is ATC(Q) = +Q, its average variable cost is AVC(Q) = Q, and its marginal cost is MC(Q) = 2Q. Suppose that there are currently 500 active wheat farms in the market, and the market demand curve is given by pD = 20 -0°. 1000 a.) What is the short-run market supply curve in this market? e.) Calculate the number of wheat farms that will be active in the long-run equilibrium of this market. b.) Compute the short-run competitive equilibrium in this market. c.) Compute the profit or loss of the individual wheat farms in the short-run competitive equilibrium.
2., Consider the market for wheat, which is approximately perfectly competitive. The d.) How much profit will wheat famms earn when this market is in long-run equilibrium? Why? average total cost of the typical wheat farm is ATC(Q) = +Q, its average variable cost is AVC(Q) = Q, and its marginal cost is MC(Q) = 2Q. Suppose that there are currently 500 active wheat farms in the market, and the market demand curve is given by pD = 20 -0°. 1000 a.) What is the short-run market supply curve in this market? e.) Calculate the number of wheat farms that will be active in the long-run equilibrium of this market. b.) Compute the short-run competitive equilibrium in this market. c.) Compute the profit or loss of the individual wheat farms in the short-run competitive equilibrium.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter8: Perefect Competition
Section: Chapter Questions
Problem 5SQP
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