A firm in a competitive market has the following cost structure: Quantity Total Cost (Units) (Dollars) 1 10 12 3 15 4. 24 5 40 Refer to Table 14-7. If the market price is $16, this firm will Oa. produce 5 units of output in the short run and face competition from new market entrants in the long run. Ob. shut down in the short run and exit in the long run. Oc. produce 5 units of output in the short run and exit in the long run. Od. produce 4 units of output in the short run and exit in the long run.
Q: If the market price for the perfectly competitive firm represented in Figure 1.5 is $4... Figure 1.5…
A: "In perfectly competitive market structure firms produce homogeneous products and are price taker.…
Q: A perfectly competitive firm has the following total cost function: Total output Total Cost 0…
A: Profit is maximized when Price = MC, where MC = Change in TC / Change in Q When Q = 4, MC = (69 -…
Q: 39) A profit-maximizing firm in a competitive market produces small rubber balls. When the market…
A: "A profit-maximizing firm will always produce at a point where it's marginal revenue equates the…
Q: Ali is operating his firm under a perfectly competitive industry. The fixed cost of his firm per day…
A: Given the fixed cost = TK 100 Let the competitive price for doing part b is = TK 22
Q: Consider the following cost information for a firm that operates in a perfectly competitive market.…
A: Marginal cost is the additional cost incurred with an additional unit of output produced. A…
Q: Question 2 (total product is Q of production) Total product TFC AFC TVC AVC TC MC $4 $_ $. 1 $12 2…
A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…
Q: In a perfectly competitive market, market demand is given by Qd and market supply is given by Qs…
A: ATC=Q+400/Q ATC is minimized when Q=20 In the long run, perfectly competitive firms earns zero…
Q: A company in a purely competitive market has a short run total cost function given by TC = 50 + 4Q…
A: In the perfectly competitive market structure there exists a large number of buyers and sellers of…
Q: Suppose that the following data are observed for a perfectly competitive firm: output = 5000 units,…
A: The perfect competition is the market structure with large number of buyers and sellers, selling…
Q: Claude’s Copper Clappers sells clappers for $65 each in a perfectly competitive market. At its…
A: Since you have asked multiple question so we will solve the first question for you if you want…
Q: Table: Total Cost for a Perfectly Competitive Firm Quantity per Period Total Cost $10 16 2 3 20 22 4…
A: Upto price of $45,firm would produce at a non negative profit.
Q: 10 S, Demand 7 Supply D, 1 D. 10 20 30 40 50 60 70 80 06 100 QUANTITY (Millions of pounds) The new…
A: The equilibrium is obtained where Demand and Supply curve intersect each other.
Q: Surplus A perfectly competitive firm has this short run total cost equation: STC = 4q2 + 81 a. Find…
A: Cost of production is the monetary value incurred on factors of production . There are two types of…
Q: The market supply in the perfectly competitive market for Ramen noodle bowls is P=8+5Q. In this…
A: P=8+5Q Apply 25 as Q in the equation
Q: Exercise 2: A perfectly competitive firm has cost function: AVC = 2Q + 4 (P: $, Q: kg). When the…
A: Answer - Thank you for submitting the question. But we are authorized to solve only 3 sub parts for…
Q: Multiple choice - microeconomics 41) Where is the competitive firm’s short-run supply curve…
A: During the short run, only one factor is variable and the rest of all the factors are fixed factors.…
Q: Refer to the table to the right which shows the short - run cost data of a perfectly competitive…
A: The total cost incurred by a firm operating in a market includes fixed costs and variable costs.…
Q: Price is $6. A firm is producing the output level at which average total cost equals marginal cost,…
A: A perfectly competitive market refers to the market in which there is a large number of buyers and…
Q: Someone opens a dry cleaning business. He hires a business consultant to advise him on how to…
A: (1) For a perfectly competitive firm, P=SMC is the short-run supply equation. STC = 10 + Q + 0.1Q2…
Q: Exhibit 9a.1: Costs for the Zonker Company Quantity (units per week) Total Cost Total Variable Cost…
A: Marginal cost is u shaped and passes through the minimum points of average variable cost and average…
Q: Question 9 Refer to Table 5-1 and the firm in Question 8. At which quantity will the firm choose to…
A: Perfectly competitive market is that market which have following characteristics large numbers of…
Q: MC ATC 11. Refer to the above graphs for a competitive market in the short run. Which of the…
A:
Q: onsider the following cost information for a firm that operates in a perfectly competitive market.…
A: In perfectly competitive market, firms earn economic profits in the short run. With free entry and…
Q: The short-run market demand and supply for Kente cloth are expressed as follows: Demand:P=40-0.25Q…
A: ANS Demand : P = 40 – 0.25Q Supply : P = 5 + 0.05Q Total Revenue (TR) = Price × Quantity demanded.…
Q: A perfectly competitive firm's total cost and marginal cost functions are: TC = 40 +0.1 Q² -0.2Q and…
A: In the perfectly competitive market, firm produces where the P =MC.
Q: Output Total Cost $5 1 $10 $12 3 $15 4 $24 $40 5 If the market price is $16, this firm will A.…
A: Total revenue and profit is shown in below table.
Q: Refer to Figure #1. The short-run supply curve for a firm in a perfectly competitive market is O the…
A: The short run supply curve of a perfectly competitive firm is the firm's marginal cost on all points…
Q: Figure: Cost Curves for Corn Producers Reference: Ref 12-3 (Figure: Cost Curves for Corn Producers)…
A: The profit maximizing output occurs at the point where the marginal cost is equal to marginal…
Q: Sunrise Juice Company sells its output in a perfectly competitive market. The firm's total cost…
A: a)
Q: Quantity of cherries Total Cost (in pounds) S2 13 16 21 28 38 Use Table: Cherry Farm. Suppose there…
A: Supply curve: Supply curve is a graphical representation of of the relation between price of a…
Q: Table: Total Cost for a Perfectly Competitive Firm Quantity per Period Total Cost s10 16 2 20 22 24…
A: Profit will be maximised at the point where the difference between TR and TC is maximum.
Q: A firm in a perfectly competitive market has a short-run total cost function equal to SRTC=4+20q,…
A: Perfect competition is a type of market where the price and quantity of goods sold is determined by…
Q: 9 The total cost function for a PC firm is as follows: TC=100+160Q-8Q2+0.4Q3 What is the minimum…
A: In the short run the firm has to incur fixed cost. The production decision in the short run depends…
Q: Claude’s Copper Clappers sells clappers for $65 each in a perfectly competitive market.
A: As per answering guidelines, should answer only first question.
Q: After which administrative assistant do diminishing marginal returns begin for Jose's Tax Office?…
A: No of assistants Total product marginal product total revenue = total product × price marginal…
Q: Mr DIY is a new small scale palm oil supplier. There are many small scale palm oil suppliers in the…
A: Creation of palm oil that conforms to willful maintainability guidelines is developing at a quicker…
Q: A perfectly competitive form sells 40 units of output at the market price of $ 380 per unit . It's…
A: The marginal revenue forms the horizontal straight line which equates the price in the market with…
Q: Mr DIY is a new small scale palm oil supplier. There are many small scale palm oil suppliers in the…
A: Creation of palm oil that conforms to willful maintainability guidelines is developing at a quicker…
Q: he accompanying table represents the quantity produced, he total revenue, and the total cost of a…
A: In a perfectly competitive market there are large number of firms selling identical products thus…
Q: Graph represents the cost structure of an individual firm in a perfectly competitive market. If the…
A: A competitive market has numerous number of firms and buyers interplaying with each other for To the…
Q: George's Goji Farm has this short run total cost equation for goji berries, where Q is the number of…
A: The marginal cost (MC) or the incremental cost is the gain in cost that results from producing an…
Q: Exhibit 0126 $/q 6.00 MC ATC 4.90 AVC 4.00 d = MR 2.80 2.60 12 14 1. If the price-taking firm in…
A: Hi, thank you for the question. As per the Honor code, we are allowed to attempt only first…
Q: A perfectly competitive firm that makes car batteries has a fixed cost of $10,000 per month. The…
A: In perfect competition, there are large number of buyers and sellers and each firm sells identical…
Q: You are a business manager working for a firm in a purely competitive market and you just hired a…
A: a) The profit of a perfectly competitive firm is when its MC = price. Also, this firm is a price…
Q: You are the manager of a firm that sells its product in a competitive market at a price of $40. Your…
A: Given; Competitive market price of product= $40 Cost function; C(Q)=60+4Q2 Marginal Revenue:-…
Q: Suppose that a firm in a competitive market has the following cost curves: Price 13 + 12 11 10 MC…
A: In a competitive market structure there are a large number of buyers and sellers in the market…
Q: Marginal cost= 2x+3 Average variable cost= x+3 Variable cost=x^2 + 3x x is the daily output.…
A: The main aim of every firm is to maximize its profits. profits are the excess of revenue receipts…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- A company in a purely competitive market has a short run total cost function given by TC = 50 + 4Q + 1.5 Q2. The unit price of the company’s product is Br. 13. A economist working on the efficiency of the company suggested that it has better shut down the business. Do you agree? Explain.7. Claude’s Copper Clappers sells clappers for $65 each in a perfectly competitive market. At its present rate of output, Claude’s marginal cost is $65, average variable cost is $45, and average total cost is $67. To maximize his profit or minimize his loss in the short run, Claude should increase output reduce output but not to zero maintain the present rate of output shut down raise price 8. A price taker in a perfectly competitive industry is currently selling 6000 units per month at the market price of $8 per unit. Monthly total variable costs are $50,000 and total fixed costs are $20,000. Marginal cost is $8 per unit and rising. Economic profits a. are equal to zero b. are greater than zero c. are less than zero d. cannot be determined 9. Choose two (2) of the incorrect answers to multiple choice Question #7 (Claude’s Copper Clappers problem) and explain why they are incorrect.Claude’s Copper Clappers sells clappers for $65 each in a perfectly competitive market. At its present rate of output, Claude’s marginal cost is $65, average variable cost is $45, and average total cost is $67. To maximize his profit or minimize his loss in the short run, Claude should increase output reduce output but not to zero maintain the present rate of output shut down raise price A price taker in a perfectly competitive industry is currently selling 6000 units per month at the market price of $8 per unit. Monthly total variable costs are $50,000 and total fixed costs are $20,000. Marginal cost is $8 per unit and rising. Economic profits are equal to zero are greater than zero are less than zero cannot be determined Choose two (2) of the incorrect answers to multiple choice Question #7 (Claude’s Copper Clappers problem) and explain why they are incorrect.
- Case A: Jackie Brown Company.Suppose you are the economic advisor of Jackie Brown Company, a perfectly competitive company that is suffering economic losses due to unforeseen continuous drop in the market price. Jackie Brown is a price taker; hence it cannot influence the market price, nor could it change production technology in the short run. You are asked to decide whether the company should shut down its operations or to continue to operate at a loss. Jackie Brown is selling 50 units of output per day, at a price of $20 per unit. The cost of raw material, direct labor, energy, and other variable inputs is about $24000 monthly. Unfortunately, an estimate of Jackie Brown fixed costs is currently unavailable.So, what is your decision? Justify your answer.A5 Course: Microeconomics - Cost and Production A firm produces shoes using L (labor) and machines (K). Its production function is Q = K1/3 L2/3. Assuming K fixed at 8, price of capital (r) is $4 and wage(w) is $2, find and plot the short-run cost curves. Also show that CMeT (AMC) reaches its value at the level of production where it equals Marginal Cost (MC). And show that CMeT (AMC) is ALWAYS decreasing at the beginning due to fixed cost. Demonstrations should use the necessary calculations.(MANAGERIAL ECONOMICS) Show algebraic solution please Assume that B = -Q 2 + 4,500Q and C= 2Q 2 are the benefits and costs of increasing the units of X-brand energy drink (in a 500 ml bottle).A. What is the profit function of X-brand energy drink production? B. What is the profit-maximizing value of Q? Solve the problem using a tabular solution, showing the Profit, MB, MC and MNB values; assume Q varies by 50 units (in 500 ml bottle). Highlight the profit maximizing level.
- Assume the following unit cost data are for a purely competitive producer. Required A. How much would be the total revenue? B. What will be the profit-maximizing or loss-minimizing output? C. how much would be the total cost?. In a perfectly competitive market there is a donut shop that sells 1,200 donuts daily. Each donut sells for the market price of $0.75 and they sell out every day. Assume that this company has labor costs of $275 and materials costs of $400. a. Using only variable costs, what is the donut shop’s daily profit? - Now assume that the owner is thinking of adding a second location downtown. The capital investment required is $4,000 (Sunk Cost). The $4000 is Sunk Cost. The normal rate of return is 5%. b. If the new shop could operate under the same conditions as the original location is it a good business decision to expand? c. What would be the new shop’s daily profit?Question 3 (b) A garment factory’s production function is provided in the table.The gross profit per unit (difference between selling price and material cost, but not including the cost of labour) is $100. # Workers Output 1 20 2 36 3 48 4 56 5 60 6 62 (i) If the wage rate is $1,000 a week, how many workers should the factory hire? (ii) If a surge in popularity for the factory’s brand allows them to raise the product price such that the gross profit rises to $150, how many workers will the factory hire now? (iii) Calculate the number of garments produced in each of the two cases above.
- Multiple choice - microeconomics 39) A profit-maximizing firm in a competitive market produces small rubber balls. When the market price for small rubber balls falls below the minimum of its average total cost but still lies above the minimum of average variable cost, what happens to the firm? A. It will experience losses, but it will continue to produce rubber balls. B. It will be earning only accounting profits. C. It will be earning both economic and accounting profits. D. It will shut down. 38)Rasiah's Garden of fruit is a firm selling fruits in a perfectly competitive market. Total fixed cost is RM50, and the wage for labour is RM5 per worker. The estimated output produced and cost are as follows: Labour Output (Kg of fruits) usage 0. 0. 8. 10 12 20 17 30 24 40 33 50 44 60 57 70 Calculate the total variable cost, average total cost, average variable cost, marginal cost, total revenue and marginal revenue. b. If Rasiah's garden of Fruits sells a kilo of fruit for RM3.50, how many Kg of fruit (output) should the firm sell in order to maximise profits, and how much profits would the firm make?Consider a firm that is currently producing a level of output that maximizes its profits. The firm generates revenue of $40 million per month. Each month, the firm spends $30 million on worker compensation and $20 million on renting buildings and machinery. a) What is this firm’s current monthly profit? b) Should this firm continue to operate in the short run? Why?