EBK MICROECONOMICS
2nd Edition
ISBN: 9780134458496
Author: List
Publisher: VST
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Question
Chapter 6, Problem 5P
(a)
To determine
Assume town A market to be
(i) Shift in short-run AFC curve.
(ii) Shift in short-run
(iii) Change in short-run profit-maximizing output due to license.
(b)
To determine
Assume town B market to be perfectly competitive, and the license for candle production not to be mandatory. The government has increased the wages of workers working in town B. Then, state
(i) changes in the AFC curve due to the imposition of minimum wages.
(ii) changes in short-run AVC curve due to the imposition of minimum wages.
(iii) Effect on the profit maximization output.
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