Question

A firm operates in perfectly competitive markets with the
following demand and cost functions:

QD=610-2P

TC=0.25Q^2+200Q+25.

The Marginal Cost function is: MC=0.5Q+200 and the ATC is
minimized at Q=10

How many firms are in the market in the long-run?

Select one:

a. N=10

b. N=15

c. N=20

d. N=25

Answer #1

A firm operates in perfectly competitive markets with the
following demand and cost functions:
TC=0.5Q2+100Q+50 Q=1000-4P
a) What is the long-run equilibrium
price and quantity in the
market?
b) How many firms are there in the industry in the long-run?

In a perfectly competitive market, market demand is QD = 380 –
2P and market supply is QS = 2P - 20. Each
firm has short-run MC = 5Q and ATC = 2.5Q + (100/Q) (ATC is at
minimum when Q = 6.32).
4. How much output will each firm produce?
a.
180
b.
10
c.
20
d.
100
5. What is the profit/loss for each firm in the short-run?
a.
$-7, 000
b.
$900
c.
$2, 500
d.
$0...

A perfectly competitive firm in the short run has Total Cost and
Marginal Cost functions given by TC(Q)=9+Q+Q2 and
MC(Q)=1+2Q, respectively. The firm faces a price of P=$17.
Determine the output that the firm will produce and the profit.
Show the solution graphically.

A perfectly competitive firm has the following total cost and
marginal cost functions:
TC = 100 +
10q – q2 + (1/3)q3
MC =
q2 – 2q +10
a) For quantities
from 0 to 10 determine: TC, TFC, TVC, and MC.
b) For quantities
from 0 to 10 determine: ATC, AFC, and AVC.
c) Assume P (MR)
equals 45. For quantities from 0 to 10 determine: TR and
profit.
d) At what quantity is
profit maximized?...

1. All of the following are characteristics of perfectly
competitive markets, except:
A: No barriers to entry or exit (fully
mobile)
B: Large number of buyers & sellers
C: A homogeneous product (not
differentiated)
D: Individual firms have the power to control
price.
2. The individual firm's demand curve (as compared to
the market demand curve) in a perfectly competitive market
is:
A: Perfectly inelastic (vertical)
B: Downward sloping, but inside of the market
demand curve.
C: Perfectly elastic (horizontal...

2. Suppose a representative firm producing in a perfectly
competitive industry has the following cost function: C(q) = q2 +
8q + 36 a. Solve for the firm’s average cost function. b. At what
level of q is average cost minimized (i.e. what is the minimum
efficient scale for the firm)? What is the value of average cost at
this level of q? c. Suppose all firms in this industry are
identical and the demand function for this industry is...

Suppose a representative firm producing in a perfectly
competitive industry has the
following cost function:
C(q) = q2 + 8q + 36
a. Solve for the firm’s average cost function.
b. At what level of q is average cost minimized (i.e. what is the
minimum efficient scale for the
firm)? What is the value of average cost at this level of q?
c. Suppose all firms in this industry are identical and the demand
function for this industry is as...

A perfectly competitive firm’s total cost function is given
by: TC = 400+4Q^2 . The minimum point of average total cost (ATC)
is reached at Q=10. You also know that the market demand function
for this product is: QD=100-P. How many firms are in the market in
the long-run? (Hint: first you need to find the price in the
long-run)
Select one:
a. N=6
b. N=4
c. N=2
d. None of the above

Competitive Market :
The market demand is Q = 2600-100P
there are 100 identical firms in the market, each with
Total cost TC = 0.25q^2 + 20q + 16
Marginal cost MC = 0.5q + 20
P = market price
Q = market output
q = output of individual firm
A. calculate the market equilibrium price and output.
B. Calculate a firm's profit or loss at the market
equilibrium

You are a producer in a constant-cost perfectly competitive
industry. Your long-run total, marginal, and average costs are
given by TC = 2Q² + 128, MC =
4Q, and ATC = 2Q+ (128/Q). What
is the long-run equilibrium price?

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