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Assume the market for chips is perfectly competitive.  The market supply and demand curves for chips are given as follows:                       supply curve:  P = 0.000002Q    demand curve: P = 11 - 0.00002Q                The short run marginal cost curve for a typical chips factory is:  MC = 0.1 + 0.0009Q   Determine the equilibrium price for chips.   Determine the profit maximizing short run equilibrium level of output for a chips factory.   Assuming that all of the chips factories are identical, how many chips factories are producing chips?

Assume the market for chips is perfectly competitive.  The market supply and demand curves for chips are given as follows:                       supply curve:  P = 0.000002Q    demand curve: P = 11 - 0.00002Q                The short run marginal cost curve for a typical chips factory is:  MC = 0.1 + 0.0009Q   Determine the equilibrium price for chips.   Determine the profit maximizing short run equilibrium level of output for a chips factory.   Assuming that all of the chips factories are identical, how many chips factories are producing chips?

Micro Economics For Today
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter8: Perefect Competition
Section: Chapter Questions
Problem 8SQP
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Assume the market for chips is perfectly competitive.  The market supply and demand curves for chips are given as follows:                      

supply curve:  P = 0.000002Q    demand curve: P = 11 - 0.00002Q               

The short run marginal cost curve for a typical chips factory is:  MC = 0.1 + 0.0009Q

 

  1. Determine the equilibrium price for chips.  
  2. Determine the profit maximizing short run equilibrium level of output for a chips factory.  
  3. Assuming that all of the chips factories are identical, how many chips factories are producing chips? 
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