Firm make a positive economic profit-zero economic profit

Assignment Help Business Economics

Reference no: EM13984207

Figure 1 shows the shortrun cost curves of a toy producer. The market has 1,000 identical producers and Table 1 shows the market demand schedule for toys.

1. At a market price of $21 a toy, what quantity does the firm produce in the short run and does the firm make a positive economic profit, a zero economic profit, or an economic loss?

2. At a market price of $12 a toy, how many toys does the firm produce and what is its economic profit in the short run? How will the number of firms in the market change in the long run?

3. At what market prices would the firm shut down temporarily? What is the market price of a toy in longrun equilibrium? How many firms will be in the toy market in the long run? Explain your answer.

Bade, Robin; Parkin, Michael (2014-02-26). Foundations of Microeconomics (7th Edition) (Page 397). Prentice Hall. Kindle Edition.

Reference no: EM13984207

Questions Cloud

Against these arguments for trade restrictions : Now assume you are an astute student of economics (not a hard assumption, we hope). Although all the arguments for restricting trade have their shortcomings, name the two or three arguments that seem to make the most economic sense to you. For each, ..

The increase in the number of people employed : Between January 2010 and January 2013, U.S. employment increased by 4.9 million workers, but the number of unemployed workers declined by only 2.7 million. How are these numbers consistent with each other? Why might one expect a reduction in the numb..

About rising gasoline prices : Some finance experts advise consumers not to worry about rising gasoline prices, the cost of which can easily be covered by forgoing one takeout meal a month, but to worry about how high energy prices will affect the rest of the economy. For example,..

Highest total utitily involves a comparison : The step-by-step process of finding the choice with highest total utitily involves a comparison of the:

Firm make a positive economic profit-zero economic profit : Figure 1 shows the shortrun cost curves of a toy producer. The market has 1,000 identical producers and Table 1 shows the market demand schedule for toys. At a market price of $21 a toy, what quantity does the firm produce in the short run and does ..

Aggregate supply and demand : Plot each of the following scenarios on a qualitative graph with aggregate demand, short-run aggregate supply, and long-run aggregate supply. Measure the aggregate price level (P) on the vertical axis in your graphs and measure real GDP (Y) on the ho..

Perfect competition and monopolistic competition : For 2 different companies from 2 different market types (perfect competition, monopolistic competition, oligopoly, monopoly) provide well thought out, typewritten responses to the following. Description of Company’s Products and/or Services: Name of ..

Economic consequences and contracting-moral hazard problem : Economic consequences and positive accounting theory try to explain why managers care about accounting policy choices and to predict how managers will respond to changes in accounting standards. Explain the relation between economic consequences and ..

Two markets differ in their demand for the firms product : The following shows the demands and marginal revenue in two markets, 1 and 2, for a price discriminating firm along with total marginal revenue, MRT, and marginal cost MC. Compare the demand conditions in each market; i.e. how do the two markets diff..

User Account

All Pages