Assume the normal production process for beet sugar

Assignment Help Macroeconomics

Reference no: EM1338092

Process of a perfectly competitive market

The market for beet sugar is purely competitive and entry is free. There are 1000 producers in the industry each of which has a total cost function given by:

TC= 240q - 20q² +q³

The demand: Q= 21,280 - 2P

1- determine the industry's supply curve and graph it.

Suppose the normal production process for beet sugar uses high-sulfur oil for fuel and releases 2 units of sulfur dioxide to the air for every ton of beet sugar produced.
2- then the market reaches short-run equilibrium, how many units of sulfur dioxide does the industry dump into the air per week? Show calculations.
3- An anti-pollution law is passed which requires the industry to burn only low-sulfur oil. The use of low-sulfur oil has the effect of adding $225 to the cost of every ton of beet sugar produced. Otherwise, every productive operation is unchanged. How will this regulation affect the industry supply curve? Draw the new supply curve.
4- When the market reaches (short-run) equilibrium with the regulation in force, how much pollution will the industry produce each week, given that use of low-sulfur oil reduces pollution to 0.75 units of sulfur dioxide per unit of output? Show calculations.
5- What is the effect of the regulation on the price paid by the buyer of beet sugar?
6- Without regulation, how much profits would each firm be making?
7- If there is free entry, what would be the long-run industry price and quantity and what would be the number of firms in the industry (without regulation)?
8- Describe the process in 7 above that would drive the industry into long-run equilibrium.

Reference no: EM1338092

Questions Cloud

Explain business proposal- triangle solution : Explain Business Proposal- Triangle Solution and I need help with the following regarding Triangle Solution

Roman civilization : How did cleopatra advance the cause of the Roman Civilization?

Securities markets-start-up financing : What agencies regulate securities markets? How are start-up firms usually financed? Differentiate between a private placement and a public offering.

The repayment of the bank loan : Explain what operating sources provide the cash for the repayment of the bank loan.

Assume the normal production process for beet sugar : Assume the normal production process for beet sugar uses high-sulfur oil for fuel and releases 2 units of sulfur dioxide to the air for every ton of beet sugar produced.

Who know good technical knowledge of the project field : suppose that there is some consensus with the basic premise that most skills can be learnt, which would you expect to be the more productive task, if re-skilling Project Managers.

Role of cosmic occurrences : Pick at least two creation myths from two different cultures. For ideas, refer to this week's readings. These should be specific stories such as "Out of the Blue" or "Genesis" from Myth and Knowing, or any of the stories assigned from the World My..

A new taco-making machinery which is similar in size : A new taco-making machinery which is similar in size and cost to hog dog carts has encouraged more street vendors to begin selling tacos.

Explain speak to your skills and accomplishments : Explain speak to your skills and accomplishments and What should you like to know about yourself or showcase to others in the letters of referral you are collecting

User Account

All Pages