Suppose that there are 110 identical firms in the market, each with a cost function C(q) = 90 + 0.1q², and that market demand is D(g) = 130- 17р. What is the equilibrium price?
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- Consider an imperfectly competitive service provider, Muscat Automotive Repair Services (MARS), whose total cost of production is C = 30Q +0. 165Q2. Also, MARS faces two different market segments, A and B, whose demands can be linearly expressed as QA = 240 − PA and QB = 120 − 0.5PB . (Hint: the marginal cost is the slope of the total cost function). 4. If MARS decides to segment the market in accordance with the demands of groups A and B, find the profit-maximizing prices and quantities (PA, QA) and (PB, QB).5. What is the value of the consumer surplus for each group A and B, under this segmentation strategy?6. Draw the situation described in (4) and (5) above, clearly showing each group’s profitmaximizing price and quantity, and the areas that correspond to their consumer surpluses.7. Verify the inverse elasticity rule under each of the scenarios described (1) and (4) above.A price-taking firm's variable cost function is C = Q3, where Q is the output per week. It has an avoidable fixed cost of $2,000 per week. Its marginal cost is MC = 3Q2. What is the profit maximizing output if the price is P = $192? Multiple Choice A. 0 B. 6 C. 10Suppose the inverse demand curve on ore is given by P = 96 - 0.72 Q. Ore can be either mined or obtained through a recycling program. The marginal cost of mining is MC1 = 7 q1. The marginal cost of obtaining ore through recycling is MC2 = 18 + 4 q2. What percent of total demand is satisfied by recycled ore (express your answer in percentage, i.e., if the answer is 45.34% then enter 45.34)?
- Suppose both cooperatives are price-takers; with PG=12 and PF =10 being the market prices of gold and fish respectively. The cost of producing G units of gold is cg(G,x)=G2+(x−4)2; where x is the quantity of mercury effluent discharged into the dam. The cost of producing F units of fish is cF(F,x)= F2 + xF ; where cF(F,x) is an increasing function of x. a) Determine the profit maximizing level of gold output, profit and level of mercury effluent discharged into the dam. Comment and explain your results. b) What is the fishing cooperative’s profit maximizing level of fish output and profit? Explain your results. c) Suppose the two cooperatives were merged to operate as a single firm; determine the socially optimal level of gold and fish output, mercury effluent and profit. Explain, comment on and contrast your results with those obtained in a and b above. d) Suppose property rights to the dam water are created and assigned to the fishing cooperative. Does this induce efficiency and…The price-demand equation for the production of bluetooth speakers is: p = 250 - 1/20x, for 0 is less than or equal to x and x is less than or equal to 5000 where x speakers can be sold at $p per each speaker. The cost to produce x speakers is given as C(x) = 150,000 + 30x, where both C(x) and p are represented in dollars ($). - find the profit function and the marginal profit and interpret the quantity P'(4500) - find the marginal cost and interpret the quantity C'(3000) - find the revenue function and the marginal revenue and interpret the quantity R'(3000)Suppose that the market demand curve of food delivery service in city A is given by P = 100 − Q, where P is the price and Q is the quantity. Currently there is only one firm. The incumbent’s cost function is given by TC = 40q, where q is the quantity provided by the incumbent. Suppose that there’s a potential entrant with cost function TC = 40qe + 100, where qe is the quantity provided by the entrant. The 100 is the sunk cost for developing the delivery system that is paid upon entering the market. a. If the entrant observes the incumbent providing qi units of service and expects this level to be maintained, what output will the entrant produce? b. At what price will the incumbent sell this output to keep the entrant out of the market?
- Suppose that the market equilibrium price for a routine service of a four-cylinder car is $270 and the minimum average variable cost of such service at your local mechanic is $300. What would you advise the owner of this business to do? Explain.Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by: C= 200 + 2Q2, where Q is the level of output and C is the total cost. a) If the price of watches is $100, how many watches should you produce to maximize profits?b) What will be your profit level?c) At what minimum price will the firm produce a positive output?A firm in a perfectly competitive market has a fixed cost of $5 and a MC function of 9X, where X is the firm's output choice, for X = 0,1,2,3 and 4 units. The current market price of X is P = $30. In this case, the optimal X* for the firm is ______ units, and at this output, the firm faces a total cost of _____. Group of answer choices 3; $59 3; $95 4; $59 4; $95
- 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) How much will the competitive fringe supply to the market at the price found in question (a)? Show the answers graphically.RM2 Suppose that there are 116 identical firms in the market, each with a cost function C(q) = 100 + 1,4q2, and that market demand is D(q) = 370 - 11p. What is the equilibrium price? answer is : 7,06 can you show me how to get this?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) How much will the dominant firm supply to the market at the price found in question (a)? Show the answers graphically