In perfect competition , firms set price equal to marginal cost . Why can't firms do this when there are internal economies of scale ? Explain the answer.
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- a. Under autarky (in absence of trade), a unit cost of labor (w) is $40 and a unit cost of capital (r) is $20 in the U.S. Draw the minimum-total-cost isocost line to produce 100 units of vaccines and label it as "(w/r)us" on the isoquant diagram of vaccines, attached to this instruction sheet. Indicate an optimal point on your diagram and label it as "US". At the optimal point, how many units of labor and capital will be used?The graph that shows the relationship between quantity produced and total costs is called ……………… a) None of the mentioned b) Export c) Production function d) Total-cost curveThe reason why the most efficient firms in a Melitz industry make greater profits under free trade is due to the fact that they Operate under increasing marginal costs. Operate under FDI. Operate under low transport costs. Operate under increasing returns to scale. Explain your answer in up to 200 words and using a diagram
- If a country chose to produce twice as many wooden chairs as before, how would that affect its production of wooden tables? show would the law of increasing costs apply to the chairs ?Discuss scale economies as they apply to trade.Some producers do not stop their production when they face loss in their production. Why?
- The reason why the most efficient firms in a Melitz industry make greater profits under free trade is due to the fact that they Operate under increasing marginal costs. Operate under FDI. Operate under low transport costs. Operate under increasing returns to scale. Explain your answer and using a diagramDiscuss how the production theory and price determinations help businesses achieve both their short-run and long-run goals.A production technology that lies on the diagram's $500 isocost line dominates a technology that lies on the diagram's $700 isocost line, no matter what happens to the price of labour and capital. is it true or false
- Suppose a hugely successful Web company has used freeconomics, expanded its scale of operations, and spread its long-run costs over larger and larger audiences. However, after years of profits, its continued growth has now caused the company’s profits to fall. Using production costs theory, explain why this situation might be occurring.what are the inefficiencies of an imperfect competition ? what are the benefits of having a increasing competition accross varies sectors?Economics Answer "False" or "True" each of the following. Justify by relying on graphical analysis whenever possible. 3.- If the marginal income is greater than the marginal cost, the competitive company will increase its profits by increasing its production (we assume increasing marginal costs). 4.- An industry in which the production process can be done with increasing economies of scale (for any level of production) cannot be one of perfect competition. answer both asap thnx
