Find the output level for highland commodities

Assignment Help Business Economics

Reference no: EM131002975

A typical firm in a perfectly competitive market has a cost structure described by the equation: C = 25 − 4QF + Q2F where QF is measured in thousands of units.

1. Using the profit-maximizing condition, P = MC, write an equation for the firm’s supply curve. If 40 such firms serve the market, write down the equation of the market supply curve.

2. In the perfectly competitive market described above, what is the equilibrium price in the long run?

3. Find the output level for Highland Commodities.

4. Let industry demand be given by the equation QD = 320 − 20P. Find total output in the long run. How many firms can the market support?

5. Starting from the long-run equilibrium above, suppose market demand increases to QD = 400 − 20P. Find the equilibrium price in the short run (before new firms enter). Check that a typical firm makes a positive economic profit. 6. In the long run—after entry—what is the equilibrium price? How many firms will serve the market?

Reference no: EM131002975

Questions Cloud

Determine the consumers budget set in case : A consumer has a budget of $250 to spend on electricity and food. The price of food is $1. Initially, the price of electricity is 10¢/KwH (kilowatt hour). However, in order to discourage excessive use of electricity and promote conservation, the Publ..

What must he prove to be successful in his claim : Buchanan went into a store in Los Angeles. When celebrities Jennifer Lopez and Ben Affleck entered the store to shop, the manager asked Buchanan to leave, but did not give him a reason why he was asked to leave. Two Los Angeles County sheriff’s deput..

Monopoly set its prices in order to maximize profits : How high should a monopoly set its prices in order to maximize profits? When you post a response to this question, place it in the context of one of the following examples:

Causes of real estate bubble and ensuing financial crisis : What were the main causes of the real estate bubble and the ensuing financial crisis? Why did the crisis spread from subprime mortgages to the entire financial sector and, ultimately, the economy?

Find the output level for highland commodities : A typical firm in a perfectly competitive market has a cost structure described by the equation: C = 25 − 4QF + Q2F where QF is measured in thousands of units. Using the profit-maximizing condition, P = MC, write an equation for the firm’s supply cur..

What is the interpretation of each parameter : You are concerned about the damage that automobile pollution is causing our nation’s environment and are interested in the effect that gasoline prices have upon gasoline consumption. Specify your economic model as well as your econometric model of ga..

What are the reserve-deposit ratio-currency-deposit ratio : In the economy of Panicia, the monetary base is $1,000. People hold a third of their money in form of currency (and thus two-thirds as bank deposits). Banks hold a third of their deposits in reserve. What are the reserve-deposit ratio, the currency-d..

Conflicting political economic perspectives exist : Conflicting political economic perspectives exist between many nations. Using the United States , Japan, and the former Soviet Union as examples, describe how each nation views capitalism and name at least 2 policy tools used by each to advance their..

Solve using tabulated factors : The CFO of Marta Aarana Cement Industries knows that many of the diesel-fueled systems in its quarries must be replaced at an estimated cost of $20 million 10 years from now. A fund for these replacements has been established with the commitment of $..

User Account

All Pages