Principles of Microeconomics
8th Edition
ISBN: 9781337676670
Author: N. Gregory Mankiw
Publisher: Cengage Learning US
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Question
Chapter 14, Problem 8QR
To determine
The competitive firm’s supply curve is more elastic in the short run or the long run.
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Are market supply curves typically more elastic in the short run or in the long run? Explain.
In a competitive market, are market supply curves
typically more elastic in the short run or in the long
run? Explain within 40 words.
In a market this is highly competitive with little product differentiation and easy market entry, prices tend to be
Group of answer choices
a. Marginal
b. Elastic
c. Inelastic
d. Static
Chapter 14 Solutions
Principles of Microeconomics
Ch. 14.1 - Prob. 1QQCh. 14.2 - How does a competitive firm determine its...Ch. 14.3 - Prob. 3QQCh. 14 - Prob. 1CQQCh. 14 - Prob. 2CQQCh. 14 - Prob. 3CQQCh. 14 - Prob. 4CQQCh. 14 - Prob. 5CQQCh. 14 - Prob. 6CQQCh. 14 - Prob. 1QR
Ch. 14 - Prob. 2QRCh. 14 - Prob. 3QRCh. 14 - Prob. 4QRCh. 14 - Prob. 5QRCh. 14 - Prob. 6QRCh. 14 - Prob. 7QRCh. 14 - Prob. 8QRCh. 14 - Prob. 1PACh. 14 - Prob. 2PACh. 14 - Prob. 3PACh. 14 - Prob. 4PACh. 14 - Prob. 5PACh. 14 - A firm in a competitive market receives 500 in...Ch. 14 - Prob. 7PACh. 14 - Prob. 8PACh. 14 - Prob. 9PACh. 14 - Prob. 10PACh. 14 - Suppose that each firm in a competitive industry...
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- If there are 10 bakeries in a small city, why might the elasticity of demand for the products any one of them supplies be high? Why might this small city not be a good location for you to open a new bakery?arrow_forwardWhich of the following would most likely be an example of elastic supply? Choose all that apply. A. luxury brand car B. gasoline C. a brand of jeans D. salt E. tap waterarrow_forwardComment on the following statement: “In the short run, Mr. Mohammed, a seller in the Fruit& Vegetable Market in Al-Aweer, faces a demand curve that is simply a horizontalline at themarket equilibrium price. In other words, competitive sellers, in this market, face perfectlyelastic demand in the short run.”arrow_forward
- Small businesses typically do not observe the demand curves for the products they sell. For example, a local bakery could not draw the demand curve for its loaves of sourdough bread. Without this important information, how would the local bakery maximize its revenue?arrow_forwardexplain your answers in detail and use graphs whenever appropriate: The market for rental cars is very competitive. How would the following developments affect the quantity of car rentals that a typical rental car company wants to supply in the short run? a. With the easing of fears about Covid 19, people are more excited to travel than before. b. Local governments reduce the yearly fee that rental car companies have to pay for their facilities. Note, these fees do not vary with how many cars the company rents. c. Rental car companies have to pay higher wages for their workers. Suppose that initially the market for rental cars is in long-run equilibrium. a. What does the fall in the yearly fee rental car companies have to pay for their facilities do to the profits of a typical rental car company in the short run? b. What will happen to the equilibrium price and quantity of rental cars in the long run? Why? What will happen to the profits of a typical rental car company in the long run?arrow_forwardCoca cola please Addressed in the Capstone Project: Analyze how demand and supply achieve an efficient market equilibrium and calculate various elasticities of demand and supply. Define and calculate the various economic costs of production in the short and long run.arrow_forward
- What is the market price? What is the profit-maximizing output? What is total revenue at the profit-maximizing output?arrow_forwardGraph the firm’s supply curve. Your graph should include the quantities supplied for all prices at least up to the firm’s zero-profit price.arrow_forwardDraw a perfectly elastic supply curve at a price of $25. a. What can you say about quantity supplied at any price above $25?arrow_forward
- Every House in a small town has a well that provides water at no cost. However, if the town wants more than 10,000 gallons a day, it has to buy extra water from firms located outside of the town. The town currently consumes 9,000 gallons per day. a. Draw a linear demand curve b. The firm's supply curve is linear and starts at the origin. Draw the market supply curve, which includes the supply from the town's well. c. Show the equilibrium. What is the equilibrium quantity? What is the equilibrium price? Explain 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.arrow_forwardThe ability of firms to enter and exit a market over time means that,in the long run.a.the demand curve is more elastic.b.the demand curve is less elasticc.the supply curve is more elasticd.the supply curve is less elasticarrow_forwardConsider the perfectly competitive spice market. At the equilibrium price, the elasticity of market supply is 1.34 and the elasticity of demand is 0.44. Spice is a normal good. An increase in incomes cause the market PRICE of spices to rise by 2%. What is the percentage change in market QUANTITY?arrow_forward
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