Question 3 Suppose that the cost function of a firm is C(q)=4q. Suppose that this is the only firm in the market, and demand is Q(p)=10-p. What is the amount of the good produced in a competitive equilibrium in this economy? 7 4 6 3 5
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Question 3
Suppose that the cost function of a firm is C(q)=4q. Suppose that this is the only firm in the market, and demand is Q(p)=10-p. What is the amount of the good produced in a competitive equilibrium in this economy?
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- Question 5 Suppose that the cost function of a firm is C(q)=4q. Suppose that this is the only firm in the market, and demand is Q(p)=10-p. What is the Consumer Surplus in a competitive equilibrium in this economy? 18 36 20 12 15Consider the market for bicycles in the fictional province of Westvale. The market demand function for bicycles is given by P=300-2Q. The marginal cost curve for firms in this market is given by P=40+Q. Prices are measured in dollars. a) Under a competitive market equilibrium, what is the price of a bicycle? b) How many bicycles are produced under a competitive market equilibrium? c) Calculate consumer surplus, producer surplus, and total surplus under the competitive market equilibrium Suppose that the firms that were once competing in this market merge into one single firm, forming a monopoly. This monopoly has a marginal revenue function of P=300-4Q. d) What price does this monopolist charge? e) How many bicycles does the monopolist produce? f) Calculate consumer surplus, producer surplus, and total surplus under the monopolistic market outcome g) How much deadweight loss resulted from the creation of the monopolist?Consider the market for Atlantic salmon. Petuna, Tasmania’s smallest salmon farm, and Huon Aquaculture, a large corporate supplier, are both producers of Atlantic salmon. The marginal cost curves for both firms are shown in the graph below: If the market price is $13 per kilo of salmon, how many kilos of salmon would Petuna supply? What about Huon Aquaculture? How many total kilos would they collectively supply? Is this allocation the most productively efficient way to produce this quantity of salmon? i will give thumbs up thanks
- Q1. Suppose perfect competition prevails in the market for hotel rooms. The current market equilibrium price of a standard room is RM300 per night. C. Show the loss in net benefits from hotel use resulting from the tax.Suppose that a chemical manufacturing plant is releasing nitrogen oxides into the air, and these emissions are associated with health and ecological damages. Economists have estimated the following marginal costs and benefits for the chemical market, where Q is monthly output in thousands of pounds and P is price per pound. MSB = 50 – 0.4Q MSC = 2 + 0.4Q MEB = 0 MEC = 0.2Q. Find the competitive equilibrium, QC and PC.The market demand for Gucci bags is given by the function P = 75 - 1.5Q. P is price per bag, and Q is output per time period. The market supply is given as P = 25 + 0.50Q. A typical competitive firm that markets this type of bag has a marginal cost of production of MC = 2.5 + 10q. a) Calculate the market equilibrium price for the bags as well as the output rate in the market. b) Calculate how much the typical firm will produce per time period at the equilibrium price. c) If all firms had the same cost structure, how many firms would compete at the equilibrium price computed in (a) above?
- Q1. Suppose perfect competition prevails in the market for hotel rooms. The current market equilibrium price of a standard room is RM300 per night. 2. Suppose a RM50 per night tax is levied on hotel occupancy. Show how this tax will prevent the market from achieving efficient output.When the number of competing firms is small in a market, is this market necessarily different from a perfectly competitive market in terms of market power and efficiency? Develop your in-depth analysis and argument on the basis of relevant economic theory or models. Also discuss and explain how market power can empirically and practically (from a competition policy point of view) be assessed.The tables (below) show the willingness to pay by three (competitive) consumers for additional units of some good, and the marginal costs of three (competitive) firms that produce that good. a) Compute the competitive equilibrium quantity and price for this market. Also, compute each consumer's surplus and each firm's profits. b) Now suppose that you have access to the same technology (and competitive input markets) as that of Firm 3. Entering the market (that is, launching a fourth firm) means a fixed (yes, sunk too) cost of $10. Would you decide to enter? (Entry has effects on the market, of course.) c) With the same data, suppose that all three firms merge. That is, now a single corporation controls (and decides on output for) all three firms (now, plants of one single firm). Obtain the output (or, equivalently, the price) that this monopolistic corporation will choose, and evaluate the consequences for the consumers (that is, the effect on the consumer surplus) and for the profits…
- Market demand is given as Qd = 400 - 2P. Market supply is given as Qs = 3P + 100. In a perfectly competitive equilibrium, what will be price and quantity? Question 18 options: Price will be $100 and quantity will be 200. Price will be $60 and quantity will be 280. Price will be $1 and quantity will be 500. Price will be $30 and quantity will be 140.Suppose Firm X is a dominant firm in a market where the market demand is Q = 1200 -2p. Once Firm X sets its price, those small competitors set their prices a little lower so that they can always sell up to their capacity. Assume the small firms’ combined capacity is 100 units. Further assume Firm X’s marginal cost is 50. Answer the following questions. Let Q^D be the quantity produced by the dominant firm. Write down the residual demand function faced by Firm X. (Hint: Think about how Q and Q^D are related.) Find Firm X’s profit-maximizing price.Three firms are producing a good and are competing in prices: consumers buy from the firm that has the lowest price, and each firm on its own can satisfy the entire market. If more than one firm choose the same price the demand is divided equally among them. There are no other firms in the market. Two firms have the same constant marginal cost cL and the third one has a higher marginal cost cH : cL < cH . Explain what will be the equilibrium price in this market.