3. Suppose that each firm in a competitive industry has the following costs: Total Cost: TC = 50+ ¹/29² Marginal Cost: MC = q where q is an individual firm's quantity produced. The market demand curve for this product is Demand: QD120 - 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 average total cost. or m. What is marginal cost and average total cost at that quantity? c) With free enter and exit, give the equation for each firm's long run supply curve. 1175

3. Suppose that each firm in a competitive industry has the following costs: Total Cost: TC = 50+ ¹/29² Marginal Cost: MC = q where q is an individual firm's quantity produced. The market demand curve for this product is Demand: QD120 - 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 average total cost. or m. What is marginal cost and average total cost at that quantity? c) With free enter and exit, give the equation for each firm's long run supply curve. 1175

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter13: Firms In Competitive Markets

Section: Chapter Questions

Problem 11PA: Suppose that each firm in a competitive industry has the following costs: Total cost: TC = 50 + q2...

See similar textbooks

Similar questions

A market in perfect competition is in long-run equilibrium. What happens to the market if labor unions are able to increase wages for workers?
Firms ill a perfectly competitive market are said to be price takers that is, once the market determines an equilibrium price for the product, firms must accept this price. If you sell a product in a perfectly competitive market, but you are not happy with its price, would you raise the price, even by a cent?
Return to Figure 9.2. Suppose P0 is 10 and P1 is 11. Suppose a new firm with the same LRAC curve as the incumbent tries to bleak into the market by selling 4,000 units of output. Estimate from the graph what the new firms average cost of producing output would be. If the incumbent continues. to produce 6,000 units, how much output would the two films supply to the market? Estimate what would happen to the market price as a result of the supply of both the incumbent firm and the new entrant. Approximately how much profit would each firm earn? Figure 9.2 Economics of Scale and Natural Monoploy
If new technology in a perfectly competitive market brings about a substantial reduction in costs of production, how will this affect the market?
Explain in words why a profit-maximizing film will not choose to produce at a quantity where marginal cost exceeds marginal revenue.
Productive efficiency and allocative efficiency are two concepts achieved in the long mm in a perfectly competitive market. These are the two reasons why we call them perfect. How would you use these two concepts to analyze other market structures and label them imperfect?