TC, = 20 + 50 TC, = 25 + 3Q; %3D %3D TC, = 15+ 40 %3! TC, = 20 +60 TC is in hundreds of dollars, and Q is in cartons per month picked and shipped. a. Tabulate total, average, and marginal costs for each firm for output levels between 1 and 5
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- 1. if the total cost function for this market is TC = 500 + 10Q2 , calculate the total and marginal costs for each of the quantities in the table. what is the demand function for this market? 2. What are the profit-maximizing quantity, price, and profit for this market? 3. If there are two firms Atlas and Bowden in this market with the same earlier total cost function and they engage in Cournot competition, what is each firm's equilibrium quantity, price, and profit? [NB: round quantities to nearest integer to find equilibrium quantity, price, and profit]TotsPoses Inc., a profit-maximizing business, is the only photography business in town that specializes in portraits of small children. George, who owns and runs TotsPoses, expects to encounter an average of eight customers per day, each with a reservation price (shown in the following table). Assume George has no fixed costs, and his cost of producing each portrait is $12. a. How much should George charge if he must charge a single price to all customer? At this price, how many portraits will George produce each day? What will be his economic profit? b. How much consumer surplus is generated each day at this price? c. If George is very experienced and knows the reservation prices of each customer, how many portraits will he produce each day and how much economic profit will he earn? d. Assume George charges only 2 different prices. He know that customers with reservation prices above $30, will never use coupons and the customers with reservation prices below will always use…Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 10 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 15 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 20 firms. PRICE (Dollars per pound) 100 90 80 70 80 50 40 30 20 10 0 0 125 250 375 500 825 750 875 1000 1125 1250 QUANTITY (Thousands of pounds) Demand Because you know that competitive firms earn Supply (10 firms) True Supply (15 firms) If there were 10 firms in this market, the short-run equilibrium price of rhodium would be $ would . Therefore, in the long run, firms would False Supply (20 firms) per pound. From the graph, you can see that this means there will be ? per pound. At that price,…
- Only two firms, Acme and Stuff Inc., sell a particular product. The table below shows the demand curve for their product. Each firm has the same constant marginal cost of $10 and zero fixed cost (so MC-ATC=$10). Price Quantity Total Revenues 10 70 65 60 55 50 45 40 28889 35 30 25 20 15 10 15 0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300 1400 0 If Acme and Stuff Inc are able to collude, how much will Acme produce? 6500 12000 16500 20000 22500 24000 24500 24000 22500 20000 16500 12000 6500 0Suppose that you are a manager for a firm like EBC Brakes, which manufactures brakes for automobiles and motorcycles. Your company has two plants, one in the United States and the other in the United Kingdom. The following tables include estimated demand and marginal revenue for your brakes, along with the marginal costs at the two factories. what quantity and price maximize your firms profit? What is the profit – maximizing number of brakes produced in the U.S. plant? In the U.K. plant? Quantity Demanded (brakes per hour) Price (dollars per brake) Quantity Produced in the U.K. plant (brakes per hour) Quantity Produced in the U.S. (brakes per hour) Total Quantity Produced Marginal Cost (dollars per brake) Marginal Revenue (dollars per brake) 104 196 47 42 89 66 92 105 195 48 44 92 68 90 106 194 49 46 95 70 88 107 193 50 48 98 72 86 108 192 51 50 101 74 84 109 191 52 52 104…Table 17-4 Only two firms, ABC and XYZ, sell a particular product. The following table shows the demand curve for their product. Each firm has the same constant marginal cost of $8 and zero fixed cost. Price Quantity Total Demanded Revenue (Dollars per unit) (Units) (Dollars) 28 26 130 24 10 240 22 15 330 20 20 400 18 25 450 16 30 480 14 35 490 12 40 480 10 45 450 8 50 400 55 330 4 60 240 2 65 130 70 Refer to Table 17-4. If this market were perfectly competitive instead of oligopolistic, what quantity would be produced? а. 25 b. 50 С. 35 d. 70 O O O O
- A computer hardware firm sells both laptop computers and printers. Through the magic of focus groups, their pricing team determines that they have an equal number of three types of customers, and that these customers' reservation prices are as illustrated in the figure below. Customer A Customer B Customer C and a price for printers of Laptop $750 $950 $650 Assume for simplicity the marginal cost of production for laptops and printers is zero. If the firm were to charge only individual prices (not use the bundle price), what prices should it set for its laptops and printers to maximize profit? Assuming for simplicity that the firm has only one customers of each type, how much does it earn in total? To maximize profit using individual prices, the firm should charge a price for laptops of P= 650 P= 100 Printer $100 $50 $150 Bundle $850 $1,000 $800 (Enter your responses as whole numbers.) In turn, profit is = $ 2150 (Enter your response as a whole number.) After conducting a costly study,…In the short run, each of the 5 firms in some industry faces a capacity constraint and constant marginal and average costs until this capacity is reached (see the table below). Marginal Cost = Average Cost Maximum output Firm $50 100 1 Firm $60 20 2 Firm $67 50 3 Firm $80 200 4 Firm $92 70 5 Assuming that no firm has monopoly (pricing) power, what will be the quantity supplied at a price of $40I alrready got the first half answered, I need the second half. JointJuice produces a prepackaged joint support supplement for relief of joint pain with 180 tablets per bottle and operates in a perfectly competitive market. Basically, all the firms in this competitive market have technologies (production and cost conditions) that are the same as JointJuice’s. Suppose JointJuice’s total cost function is given by the following where q is JointJuice’s quantity of packages per day: C(q) = 250 + 6q + 0.1q^2 The market demand function for the output in this market is given by: Q = 1848 - 2P If there are 20 identical firms in this industry, find the market equilibrium price for the prepackaged supplements. Calculate JointJuice’s optimal output level and profits given the market price for the product. If JointJuice is typical of the firms in this industry calculate the firm’s long-run equilibrium output, price, and profit level. Suppose the situation changes. JointJuice has its plant in…
- Two ready-to-eat breakfast cereal manufacturers, Lots of Sugar and Buckets of Goo, face combined demand for their products given by Q = 75 - P. Their total costs are given by TCLots of Sugar = 0.1Q2Lots of Sugar and TCBuckets of Goo = 5QBuckets of Goo. If they successfully collude, their total profits will be: a. $62.50 b. $1,250.00 c. $125.00 d. $287.50 e. $1,287.50In the aeronautical market, Boing and Airbus constitute a duopoly in the production of large airplanes. The American firm has the following cost structure C(qa) = 20 + 39a + qả, and the European firm, C(qe) 150 – P, answer the following questions. = 50 + qe + q?. If the market demand for large airplanes is given by Qp = 9a + qe = a) Interpret the cost structures of both firms b) What would be the equilibrium (quantity, price, and profit) if firms compete by quantity as in Cournot and interpret your answer. c) If they decide to form a cartel, what are the new quantities, prices, and profits? Interpret your answer using the Game Theory insights. d) Calculate now what would happen if Airbus is the leader (Stackelberg model) in terms of quantity, price, and profit and interpret your outcomes.Q1: What is the price-equillibrium under the assumption of the two companies colluding? What is the profit for each firm? Q2: Derive the output reaction curves for both firms and calculate the price-output equllibrium under this assumption. What is the profit for each firm?