What is the socially optimal number of firms

Assignment Help Finance Basics
Reference no: EM132548454

In a monopolistically competitive industry, total profits are a function of the number of firms n as follows: ( ) = 10 - 0.1 ^(2)

Furthermore, consumer surplus is a function of n : ( ) = ^(3/2)

i) In the long-run equilibrium how many firms will exist in this industry?

ii) What is the socially optimal number of firms in this industry?

iii) Does the long-run equilibrium exhibit insufficient or excessive production?

Reference no: EM132548454

Questions Cloud

Genetically inferior and psychologically impaired : Do trait theories suggest that people in the South, Midwest, and inner cities are more genetically inferior and psychologically impaired?
Price elasticity of demand and advertising elasticity : Suppose that the demand function of a new face cream is described by the demand function: ( , ) = ^(-1/2) ^(1/4)
Social structure theories : It identifies that different social classes vary in the fact that they do not have access to the same resources that society has to offer.
Why procedures should not be changed too often : The author argue that most people may agree with the notion that "All human activities benefit from some form of formalization, and that formalization allows.
What is the socially optimal number of firms : In a monopolistically competitive industry, total profits are a function of the number of firms n as follows: ( ) = 10 - 0.1 ^(2)
Criminology-focal concern : Is it possible that a distinct lower-class culture exists? Using Walter Millers list of "focal concerns",
Seven methods of ethical decision : There are seven methods of ethical decision making (i.e., ethics of virtue, natural law, religion, ethical formalism, utilitarianism, ethics of care, and egoism
Compare the opportunity cost of buying a new car : Compare the Opportunity Cost of Buying a New Car with the Opportunity Cost of Going to College?
Define the process of creative destruction : Assume that demand in a competitive market is given by the linear function: = 100 - and that current marginal cost of production

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the profitability index

A project has an initial outlay of $1,839. It has a single payoff at the end of year 5 of $6,039. What is the profitability index (PI) of the project

  Equation for expected value of perfect information

What is the equation for expected value of perfect information?

  What qualifications you have or may need to get the position

FIN 100- What qualifications you have or may need to get this position, and where do you see yourself in this career long-term. Be sure to cite the website where you found each career.

  Consider before the issuance of the bond

What are the macro economy factors and others you will consider before the issuance of the bond?

  Strategy or tactics applied by the company in offering it

How do you think business buyer behavior can have an impact on the strategy or tactics applied by the company in offering it?

  Working on a research project

His first step was determining that the question would be: 'how do sleep deprived teenagers function in school?' Evaluate which of the following should

  Peter griffin planes to retire in 20 years 1st withdrawal

peter griffin planes to retire in 20 years 1st withdrawal in year 21. he is told by glenn quagmire that he will need

  How much will be collected during the 4th quarter

Sales for the next calendar year are estimated at $2,100, $1,600, $2,500 and $2,300, respectively, by quarter, starting with the first quarter of the year. Assume a year has 360 days. How much will be collected during the 4th quarter?

  Understand the impact of inflation on interest rates

Understand the impact of inflation on interest rates. Real Cash Flows. You want to have $2.6 million in real dollars in an account when you retire in 40 years.

  What types of expense items could be a concern for company

A Company is trying to determine why their overall profit margin is low. Considering the information presented below, where within the multi-step income.

  Difference between economic failure and financial distress

What is the difference between economic failure and financial distress? Which situation is likely to lead to liquidation, and which is likely to result in reorganization?

  Income statement including gross margin & sales general

The CEO of Smartphone Apps, LLC is making a loan application. Using the data below (only), make an Income Statement. Within this Income statement, include totals for Gross Margin,

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd