The two graphs on the next page represent the market supply and demand for a good (the first graph) and the second graph shows sets of cost curves for almond production, first with an initial technology and then with an improved technology. Using the graphs, do the problems below. In answering, you will be writing out your answers AND making the appropriate drawings on the graphs to support/coincide with your written answers. Show (using boxes on the graphs) the initial profit for each technology (cost curves Y and cost curves Z) based on the initial market price as determined by the market supply and demand. You should probably use different colors for each set of cost curves. You will need to show on the market graph what the initial market price is. • Show the long-run market price that results from the standard technology adoption situation process as it is implied in the graphs of technology change. Show the price on the market graph and make the appropriate drawing that supports the long-run market price. Show (using the graphs and writing the value below) what the profit-maximizing level of output for the original technology will be after the long-run price is determined.

The two graphs on the next page represent the market supply and demand for a good (the first graph) and the second graph shows sets of cost curves for almond production, first with an initial technology and then with an improved technology. Using the graphs, do the problems below. In answering, you will be writing out your answers AND making the appropriate drawings on the graphs to support/coincide with your written answers. Show (using boxes on the graphs) the initial profit for each technology (cost curves Y and cost curves Z) based on the initial market price as determined by the market supply and demand. You should probably use different colors for each set of cost curves. You will need to show on the market graph what the initial market price is. • Show the long-run market price that results from the standard technology adoption situation process as it is implied in the graphs of technology change. Show the price on the market graph and make the appropriate drawing that supports the long-run market price. Show (using the graphs and writing the value below) what the profit-maximizing level of output for the original technology will be after the long-run price is determined.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter10: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 20P: May and Raj me the only two growers who provide organically grown corn to a local grocery store....

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