Suppose a perfectly competitive firm faces the following information: An industry demand given by P = 1,020 - Q MC = 20 + 10 ATC = Q+ 10 + 25/Q. In equilibrium, the price is equal to and there are of firms. The producer surplus in this industry is
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- 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.Suppose that the industry demand curve is given by the following quantity demanded = 100 – 0.5 output. In equilibrium, the market price is equal to 6 pesos per unit. q TR MR TFC TVC TC AC AVC AFC MC Profits 0 10 1 5 2 3 3 2 4 1 5 2 6 3 7 4 8 5 9 6 10 7 11 8 Assuming that the firm operates in a perfectly competitive market, supply the missing values in the table above. You may use a spreadsheet program to compute the values but must provide a step-by-step…A market consists of a dominant firm and a number of fringe firms. The followings are the information about these firms. Total market demand: QALL=300 – (2.5) P The competitive fringe supply function (total): QF=2P-12 The dominant firms marginal cost function: MC = 12 + (1⁄2) QD. a) What is the equilibrium price set by the dominant firm? ANSWER: P= 55.82 b) Calculate the total market demand at the price found in question 2(a). ANSWER: QALL= 160.45 c) How much will the dominant firm supply to the market at the price found in question 2(a)?
- Consider a competitive industry with a market demand curve of P = 252 – Q, where P is market price and Q is the quantity demanded in the market. Each firm in the industry has a cost function of TC = 196 + q2, if q > 0 where q is output of the individual firm (TC = 0 if q = 0). The market is initially in long-run equilibrium. The government decides to regulate the industry by issuing licences to all firms currently in the industry, and not to allow any further entry by other firms without a licence. That is, the number of licences is fixed, and entry requires that an existing licence holder sells their licence to the potential entrant, leaving the number of firms producing in the industry fixed. Subsequent to the introduction of this regulation, the market demand curve shifts to P = 432 – Q. What is the value of the licence?A market consists of a dominant firm and a number of fringe firms. The followings are the information about these firms. Total market demand: QALL=300 – (2.5) P The competitive fringe supply function (total): QF=2P-12 The dominant firms marginal cost function: MC = 12 + (1⁄2)QD. a) What is the equilibrium price set by the dominant firm? Calculate the total market demand at the price found. b) How much will the competitive fringe supply to the market at the price found in question 2(a)? c) How much will the dominant firm supply to the market at the price found in question 2(a)? d) Show the above answers graphically.Consider a competitive industry with a market demand curve of P = 252 - Q, where P is market price and Q is the quantity demanded in the market. Each firm in the industry has a cost function of TC = 196 + q^2, if q > 0 where q is output of the individual firm (TC = 0 if q = 0). The market is initially in long-run equilibrium. The government decides to regulate the industry by issuing licences to all firms currently in the industry. and not to allow any further entry by other firms without a licence. That is, the number of licences is fixed, and entry requires that an existing licence holder sells their licence to the potential entrant, leaving the number of firms producing in the industry fixed. Subsequent to the introduction of this regulation, the market demand curve shifts to P = 432 - Q. What is the value of the licence?
- A market consists of a dominant firm and a number of fringe firms. The followings are the information about these firms. Total market demand: QALL=300 – (2.5)P The competitive fringe supply function (total): QF=2P-12 The dominant firms marginal cost function: MC = 12 + (1⁄2)QD. What is the equilibrium price set by the dominant firm? Calculate the total market demand at the price found in question 2(a). How much will the competitive fringe supply to the market at the price found in question 2(a)? How much will the dominant firm supply to the market at the price found in question 2(a)? 5. Show the above answers graphically.The wheat market is perfectly competitive, and the market supply and demand curves are given by the following equations: QD = 20,000,000 - 4,000,000P QS = 7,000,000 + 2,500,000P where QD and QS are quantity demanded and quantity supplied measured in bushels, and P = price per bushel. a. Determine consumer surplus at the equilibrium price and quantity. Provide a fully labelled diagram to support your answer. Show all intercepts, equilibrium points, label axis and curves fully. b. Assume that the government has imposed a price floor at $2.25 per bushel and agrees to buy any resulting excess supply. How many bushels of wheat will the government be forced to buy? Calculate the consumer surplus with the price floor. PLEASE DRAW THE DIAGRAM ! Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.The wheat market is perfectly competitive, and the market supply and demand curves are given by the following equations: QD = 20,000,000 - 4,000,000P QS = 7,000,000 + 2,500,000P where QD and QS are quantity demanded and quantity supplied measured in bushels, and P = price per bushel. a. Determine consumer surplus at the equilibrium price and quantity. Provide a fully labelled diagram to support your answer. Show all intercepts, equilibrium points, label axis and curves fully. b. Assume that the government has imposed a price floor at $2.25 per bushel and agrees to buy any resulting excess supply. How many bushels of wheat will the government be forced to buy? Calculate the consumer surplus with the price floor. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
- A market consists of a dominant firm and a number of fringe firms. The followings are the information about these firms. Total market demand: QALL=300 – (2.5) P The competitive fringe supply function (total): QF=2P-12 The dominant firms marginal cost function: MC = 12 + (1⁄2) QD. a) What is the equilibrium price set by the dominant firm? b) Calculate the total market demand at the price found in question (a). c) How much will the competitive fringe supply to the market at the price found in question (a)? d) How much will the dominant firm supply to the market at the price found in question (a)? Show the answers graphically.A market consists of a dominant firm and a number of fringe firms. The followings are the information about these firms. Total market demand: QALL=300 – (2.5) P The competitive fringe supply function (total): QF=2P-12 The dominant firms marginal cost function: MC = 12 + (1⁄2) QD. a) What is the equilibrium price set by the dominant firm? b) Calculate the total market demand at the price found in question (a). Show the answers graphically.Consider a competitive industry with a perfectly elastic supply curve given by p = 20. The demand curve facing this industry is p(q) = 60-q. Find the per-unit tax that will maximize tax revenue to the government.