Consider a perfectly competitive firm with the following marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves.АТС$MCAVC1501301251101009050100150200300 325Using these curves, the firm faces fixed costs of:O A. $4000,O B. $2000,O C. $20,O D. $200,and average fixed costs when 200 units are produced is

Fixed cost does not depend on output produced. It remains constant even when firm produces 0 units

Consider a perfectly competitive firm with the following marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves. ATC 2$ MC AVC 150 130 125 110 100 90 50 100 150 200 300 325 Using these curves, the firm faces fixed costs of: O A. $4000, O B. $2000, OC. $20, O D. $200, and average fixed costs when 200 units are produced is

Consider a perfectly competitive firm with the following marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves. ATC 2$ MC AVC 150 130 125 110 100 90 50 100 150 200 300 325 Using these curves, the firm faces fixed costs of: O A. $4000, O B. $2000, OC. $20, O D. $200, and average fixed costs when 200 units are produced is

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter8: Perefect Competition

Section: Chapter Questions

Problem 10SQP

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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?
Briefly explain the reason for the shape of a marginal revenue curve for a perfectly competitive firm.
If new technology in a perfectly competitive market brings about a substantial reduction in costs of production, how will this affect the market?
What are the four basic assumptions of perfect competition? Explain in words what they imply for a perfectly competitive firm.
. A firm in a perfectly competitive industry currently faces a market price of $20 and is maximizing profit by producing 500 units of output at this price. The firm’s total costs are $14,000, of which $5,000 are fixed costs. a) How much profit is the firm making? (Show how you determine this.) b) Should the firm continue to produce in the short run? Explain fully. c) Should the firm continue to produce in the long run? Explain clearly WHY the long run decision may be different than the short run decision, assuming the firm expects no changes in demand conditions.
Assume that there are 100 identical company in the perfectly competitive cabbage industry. Each firmhas a short-run total cost curve given by ST C = 0.5Q2 − 10Q + 300. Solve the following: 1. Derive expressions for the corresponding short-run average cost, average variable cost,average fixed cost curve, and marginal cost.2. Calcalute the firm’s short-run supply curve with market price (P) as a function of Q (thenumber of kilos of cabbage)3. Show the industry supply curve for the 50 firms in this industry
“If Conagra is a competitive firm, it will never operate at an output where its average total cost curve is downward sloping.” True or false? Explain. I think it's false, but I don't know why though
A perfectly competitive firm faces the short-run cost schedule shown in Table (a)Calculate average total cost (ATC=TC/Q), marginal cost (MC=ATC/AQ) and marginal revenue (MR-ATR/AQ) for each level of output. The price per unit of output is £16 b) Plot ATC, MC and MR on a graph and mark the profit-maximising output. At what output is profit maximised? c) How much profit/loss is made at the optimum level of output? Assume market price declines to £9 per unit. If the firm's average variable cost is £9.5, should the firm shut down in the short run? In the long run? Explain. If the firm is typical of other firms, what price will it charge in the long run? Explain.
Suppose a perfectly competitive firm is operating in short run. The information of MR, Q, ATC and AVC are 25 taka, 60 unit, 35taka and 15taka respectively. Calculate firm’s profit/loss and total fixed cost. From these calculations and based on all the given information, can you conclude about the firm’s decision in short run? Explain your reasoning with the help of a suitable diagram. Show all the relevant information in your diagram.[Q=profit maximizing output and MR=marginal revenue]. Don,t copy from anywhere. Answer must be correct. Do step by step
B) Consider a perfectly competitive firm with the following short-run total costs: SRTC = b + j q x. The corresponding short-run marginal cost is given by:SRMC = xj q x-1. 1. If the market price is n, how much output (q) will the firm produce? What will thefirm’s profits are at a price of n? 2. Find the quantity of output for which marginal cost equals average variable cost.What does this information tell you about this firm’s decision about whether toshut down in the short run rather than produce a positive quantity of output?
If price is greater than average variable cost and less than average total cost at the profit-maximizing quantity of output in the short run, a perfectly competitive firm will: shut down production. O produce at an economic profit. O produce at an economic loss. O produce more than the profit-maximizing quantity.
Please no written by hand solutions 7If SRTC 200+2q+4qwhere q is output, the firm's short-run supply function is a.P = 2 + 8q for P >= 2 and zero otherwise b. q = 0 P < 2; 0.125P - 0.25 P >= 2 c.P = 2 + 8a for p > 0 and zero otherwise. d.q = 0 P < 0; 0.125P - 0.25 P >= 0 8 Each firm in a perfectly competitive market has long-run average total cost represented as ATC+100/q. Long-run marginal cost is MC = 200q - 10 The market demand is O^ prime =215 dot 0 * 5P . At the long-run equilibrium price, how many firms are in the market? a= 500 b. n = 1000 c. n = 1200 d.n-2000 e.n = 2400