On the following graph, use the orange points (square symbol) to plot points along the portion of the firm's short-run supply curve that corresponds to prices where there is positive output. (Note: You are given more points to plot than you need.) (?) 100 90 Firm's Short-Run Supply 80 70 60 50 40 30 20 10 0 0 5 40 45 50 10 15 20 25 30 35 QUANTITY (Thousands of jackets) Suppose there are 10 firms in this industry, each of which has the cost curves previously shown. On the following graph, use the orange points (square symbol) to plot points along the portion of the industry's short-run supply curve that corresponds to prices where there is positive output. (Note: You are given more points to plot than you need.) Then, place the black point (plus symbol) on the graph to indicate the short-run equilibrium price and quantity in this market. Note: Dashed drop lines will automatically extend to both axes. (?) 100 90 80 Industry's Short-Run Supply + Equilibrium 70 60 50 40 30 20 10 0 in the short run. In the long run, PRICE (Dollars per jacket) PRICE (Dollars per jacket) Demand 0 50 100 150 200 250 300 350 400 450 500 QUANTITY (Thousands of jackets) At the current short-run market price, firms will

On the following graph, use the orange points (square symbol) to plot points along the portion of the firm's short-run supply curve that corresponds to prices where there is positive output. (Note: You are given more points to plot than you need.) (?) 100 90 Firm's Short-Run Supply 80 70 60 50 40 30 20 10 0 0 5 40 45 50 10 15 20 25 30 35 QUANTITY (Thousands of jackets) Suppose there are 10 firms in this industry, each of which has the cost curves previously shown. On the following graph, use the orange points (square symbol) to plot points along the portion of the industry's short-run supply curve that corresponds to prices where there is positive output. (Note: You are given more points to plot than you need.) Then, place the black point (plus symbol) on the graph to indicate the short-run equilibrium price and quantity in this market. Note: Dashed drop lines will automatically extend to both axes. (?) 100 90 80 Industry's Short-Run Supply + Equilibrium 70 60 50 40 30 20 10 0 in the short run. In the long run, PRICE (Dollars per jacket) PRICE (Dollars per jacket) Demand 0 50 100 150 200 250 300 350 400 450 500 QUANTITY (Thousands of jackets) At the current short-run market price, firms will

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter13: Firms In Competitive Markets

Section: Chapter Questions

Problem 3CQQ

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Suppose that each firm in a competitive industry has the following costs: Total cost: TC = 50 + q2 Marginal cost: MC = q where q is an individual firms quantity produced. The market demand curve for this product is Demand:QD = 120 P where P is the price and Q is the total quantity of the good. Currently, there are 9 firms in the market. a. What is each firms fixed cost? What is its variable cost? Give the equation for average total cost. b. Graph average-total-cost curve and the marginal-cost curve for q from 5 to 15. At what quantity is average-total-cost curve at its minimum? What is marginal cost and average total cost at that quantity? c Give the equation for each firms supply curve. d. Give the equation for the market supply curve for the short run in which the number of firms is fixed. e. What is the equilibrium price and quantity for this market in the short run? f. In this equilibrium, how much does each firm produce? Calculate each firms profit or loss. Is there incentive for firms to enter or exit? g. In the long run with free entry and exit, what is the equilibrium price and quantity in this market? h. In this long-run equilibrium, how much does each firm produce? How many firms are in the market?