Under perfect competition, each firm is a price taker. Suppose a single seller in the wheat market. The company produces and markets wheats at a Price = $38 per container. The firm’s total costs are given as: TC = 10 +2Q + 3Q2 a) Find the Firm’s marginal cost? Show your steps, including graphs. Review additional resources? Hint: See the rules for differentiation b) What is the firm’s demand curve? Show it on a graph and label the axes showing P and Q c) What level of output should the firm produce? Hint: Set P = MC and solve for Q. Use a graph to show your answers as well
Under
TC = 10 +2Q + 3Q2
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Week 8 Chapter 8: Managing in Competitive Markets For this week read Chapter 8 INSTRUCTIONS: 1. Answer the following questions and explain your work. 2. Do not attach any other pages. 3. Download, write your answers on this same Question sheet; next, to each question. 4. Don’t write your name 5. Upload in the same drop box for the purpose of making comments 6. Don’t change the questions or use different values? Question Under perfect competition, each firm is a price taker. Suppose a single seller in the wheat market. The company produces and markets wheats at a Price = $38 per container. The firm’s total costs are given as: TC = 10 +2Q + 3Q2 a) Find the Firm’s marginal cost? Show your steps, including graphs. Review additional resources? Hint: See the rules for differentiation
b) What is the firm’s demand curve? Show it on a graph and label the axes showing P and Q
c) What level of output should the firm produce? Hint: Set P = MC and solve for Q. Use a graph to show your answers as well
d) What is the firm Fixed Cost? Why? Also, use a graph to support your answer.
e) What price should the firm charge? Why? |
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