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ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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10. Problems and Applications Q10

An industry currently has 100 firms, each of which has fixed costs of $16 and average variable costs as follows:
Complete the following table by deriving the total cost, marginal cost, and average total cost for each quantity from 1 to 6.
Quantity
Average Variable Cost
Total Cost
Marginal Cost
Average Total Cost
(Dollars)
(Dollars)
(Dollars)
(Dollars)
0   16    
 
1 1
 
    
 
2 2
 
    
 
3 3
 
    
 
4 4
 
    
 
5 5
 
    
 
6 6
 
    
 
 
The equilibrium price is currently $10.
Each firm produces __________ units, so the total quantity supplied in the market is _________ units.
 
In the long run, firms can enter and exit the market, and all entrants have the same costs as in the previous table.
As this market makes the transition to its long-run equilibrium, the price will  _______  , quantity demanded will  ________  , and the quantity supplied by each firm will  _________  .
 
Use the orange line (square point) to graph the long-run supply curve for this market.
 
 
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,quantity demanded will
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As this market makes the transition to its long-run equilibrium, the price will
My Home
each firm will
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Use the orange line (square point) to graph the long-run supply curve for this market.
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Transcribed Image Text:MindTap Cengage Learning - Google Chrome X ng.cengage.com/static/nb/ui/evo/index.html?deploymentld=5673661865502013311021331068elSBN=97813370965778&id=5715231408snapshotld=1338562& CENGAGE MINDTAP Q Search this course Dylan X Homework #8 MAIN MENU ,quantity demanded will and the quantity supplied by As this market makes the transition to its long-run equilibrium, the price will My Home each firm will Courses Use the orange line (square point) to graph the long-run supply curve for this market. A-Z CENGAGE UNLIMITED ? Browse Catalog Partner Offers 20 19 18 EE Print Options 17 Long-Run Supply 16 15 College Success 14 13 Career Center 12 11 10 ?Help 7 Give Feedback 6 5 3 Equilibrium AC 0 MARKET 10 20 40 50 60 70 80 90 100 Quantity Market Equilibrium Grade It Now Save & Continue Continue without saving 10:07 PM Type here to search C x 26 11/6/2019 30 *
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