Question

A competitive firm has a supply function given by ?(?)=8?. The firm has fixed costs of...

A competitive firm has a supply function given by ?(?)=8?. The firm has fixed costs of $180. The price of the good increases from $20 to $30.

What is the change in producer surplus? A(n) Increase  of $ _________.

How about profit? What happens to profit as a result of this price change? A(n) Increase of $ ___________

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
An individual firm in a cartel has a marginal cost function given by MC = 8...
An individual firm in a cartel has a marginal cost function given by MC = 8 + 2q . The firm agrees to quota of 3 units as part of the collusion. The competitive price of the good would be $24.8. The cartel manages to drive the price up to $41 Calculate the producer surplus for the cartel, when it produces the quota.
Consider a publicly available technology of producing a good that is characterized by the variable cost...
Consider a publicly available technology of producing a good that is characterized by the variable cost function VC(Q) = 1/2(Q^2) and fixed costs FC = 2 for a firm that operates the technology. In the short run, fixed costs are unavoidable. In the long run, fixed costs are avoidable and it is free for any firm outside of the market to enter, should it want to. In the short run, the set of firms in the market is fixed. The...
1) A perfectly competitive firm that sells fish has a marginal cost function given by MC...
1) A perfectly competitive firm that sells fish has a marginal cost function given by MC = 3q. The market has determined a price of P = 60. How many fish will this firm produce? 2)See the previous question about the perfectly competitive fish firm. Suppose that at this level of output, the firm has average costs of production of ATC = 42. How much total economic profit will the firm earn? 3) A perfectly competitive firm will shut down...
Consider a publicly available technology of producing a good that is characterized by the variable cost...
Consider a publicly available technology of producing a good that is characterized by the variable cost function V C (Q) = 1 Q2 and fixed costs F C = 2 for a firm that operates the technology. In 2 the short run, fixed costs are unavoidable. In the long run, fixed costs are avoidable and it is free for any firm outside of the market to enter, should it want to. In the short run, the set of firms in...
A perfectly competitive firm in the puzzle market has fixed costs that are sunk in the...
A perfectly competitive firm in the puzzle market has fixed costs that are sunk in the short run. The current situation facing that perfectly competitive firm is described by : (i) MC intersects ATC at $20 / puzzle. (ii) MC inteects AVC at $10 / puzzle. (iii) The market price of puzzles is $15 / puzzle. Which of the following statements is (are) true? I. This firm makes negative economic profit in the short run. II. This firm’s profits will...
Management has estimated a competitive industry's demand function to be: Q= 4,500 - 25P There are...
Management has estimated a competitive industry's demand function to be: Q= 4,500 - 25P There are 90 identical profit-maximizing, price taker firms in the industry, each with an average variable cost curve of Ave = $8 +$0.75Q and fixed costs of $600 per hour. Q is the output per hour for the firm. Find the supply function, its market clearing price, the profit maximizing output of the typical firm, and its hourly profit.
Consider an ?-firm Cournot model with identical firms and homogeneous products; the inverse demand function, marginal...
Consider an ?-firm Cournot model with identical firms and homogeneous products; the inverse demand function, marginal costs, and fixed costs are ? = ? − ??, ?, and zero, respectively. The equilibrium price is ? ∗ = ? + ?−? ?+1 . (a) Analyse what happens to consumer surplus, producer surplus, and total surplus as the number of firms increases. [5 marks] (b) Discuss how your answer may differ if the firms have U-shaped cost curves. [5 marks]
In a perfectly competitive market, the supply function is P= 1 + 2Q, and the demand...
In a perfectly competitive market, the supply function is P= 1 + 2Q, and the demand function is P = 25 - Q. Hence, in this market, consumer surplus is _____ and producer surplus is _____. If this market was to become the monopoly of a single firm with a marginal cost of production equal to 11, then the welfare loss would be ____. a) 30; 60; 3 b) 32; 64; 1.5 c) 32; 64; 3 d) 62; 34; 6
Find the long-run supply function of a perfectly competitive firm for each cost function given below:...
Find the long-run supply function of a perfectly competitive firm for each cost function given below: (b) c(q)= q^1.5+ 8q^0.5 for all q >0. Suppose the long-run market demand curve is p = 100 - Q. (a) Find the long-run market equilibrium. (b) What are the values of consumers’ and producers’ surplus
To be profitable, a firm has recover its costs. These costs include both fixed and variable...
To be profitable, a firm has recover its costs. These costs include both fixed and variable costs. One way that a firm evaluates at what stage it would recover its invested costs is to calculate how many units or how much in dollar sales is necessary for the firm to earn a profit. Consider the case of Defense Dynamics: Defense Dynamics Inc. is considering a project that will result in fixed costs of $12,000,000 and per-unit variable costs of $10.75....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT