Price B с A Cannot be determined C B The graph above depicts the demand, short-run industry supply curve and the long- run industry supply curve. Which line represents the long-run industry supply curve? Quantity
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- Firms ill a perfectly competitive market are said to be price takers that is, once the market determines an equilibrium price for the product, firms must accept this price. If you sell a product in a perfectly competitive market, but you are not happy with its price, would you raise the price, even by a cent?The figure below shows the industry demand curve and two possible industry supply curves in the perfectly competitive market for cheeseburgers. Price ($) 8 7 6 51 3 2 1 0 3 5 6 B S₂ A S₁ Select one: ● a. an excess supply of 6 cheeseburgers. b. an excess demand of 4 cheeseburgers. O c. an excess supply of 3 cheeseburgers. d. an excess demand of 6 cheeseburgers. 7 8 Cheeseburgers The market depicted in the figure above is initially at equilibrium at Point A. Suppose firms begin to exit the market, causing the supply curve to shift from S₁ to S₂. 9 10 11 12 Q If the price of cheeseburgers remains constant at $5.00, as a result of the decrease in supply there will beUse the graph below of a perfectly competitive firm to answer these questions and assume that the industry price is $P4 Price P₂ aaaa P₁ MC AVC ATC Q₁Q₂ Q3 Q4 Quantity 1. At an industry price of P4, what is the profit mazimizing level of output and what type of profit/loss is the firm earning 2. If there is a decrease in industry demand causig the industry price to fall to P2, what is the profit maximizing level output, pr position of the firm or is this firm producing in the short run? 3. What industry price represents the long run profit position for the firm?
- can you draw a diagram of long run industry supply curve, with price on the y-axis and quantity on the x-axis, and a downward-sloping curve showing the relationship between price and quantity supplied? then also draw another diagram of long run industry supply curve, with price on the y-axis and quantity on the x-axis, and a downward-sloping curve showing the original relationship between price and quantity supplied, and a second, upward-sloping curve showing the new relationship between price and quantity supplied after the increase in the price of oil?explain your answers in detail and use graphs whenever appropriate: The market for rental cars is very competitive. How would the following developments affect the quantity of car rentals that a typical rental car company wants to supply in the short run? a. With the easing of fears about Covid 19, people are more excited to travel than before. b. Local governments reduce the yearly fee that rental car companies have to pay for their facilities. Note, these fees do not vary with how many cars the company rents. c. Rental car companies have to pay higher wages for their workers. Suppose that initially the market for rental cars is in long-run equilibrium. a. What does the fall in the yearly fee rental car companies have to pay for their facilities do to the profits of a typical rental car company in the short run? b. What will happen to the equilibrium price and quantity of rental cars in the long run? Why? What will happen to the profits of a typical rental car company in the long run?Assume that the market for pasta is in long-run equilibrium and that the pasta industry is a constant-cost industry. Explain with a graph and words what will happen to the price and quantity in the market when the demand for pasta decreases.
- The figure below depicts the market supply and demand for the perfectly competitive rollerblade industry. S Price per pair of Rollerblades 1,140 070 50 150 Number of pairs of Rollerblades per week Based on the figure above, if the current quantity demanded of rollerblades is 150 per week, you accurately predict that in the short run, Q Select one: a. price and quantity supplied will increase and quantity demanded will decrease. b. price and quantity supplied will decrease and quantity demanded will increase. c. price, quantity supplied and quantity demanded will increase. d. price, quantity supplied and quantity demanded will decrease.8. Short-run and long-run effects of a shift in demand Suppose that the chicken industry is in long-run equilibrium at a price of $5 per pound of chicken and a quantity of 50 million pounds per year. Suppose that WebMD claims that a protein found in chicken will increase your expected lifespan by 3 years. WebMD's claim will cause consumers to demand more chicken at every price. In the short run, firms will respond byConsider the competitive market for sports jackets. The following graph shows the marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves for a typical firm in the industry. 72 16 AVC 16 24 40 QUANTITY (Thousards of jaats) For each price in the following tabie, use the graph to determine the number of jackets this firm would produce in arder to maximize its profie. Assume that when the price is exacty equal to the average variabie cost, the firm is indifferent between producing zero jackets and the proft-maximizing quandity. Also, indicate whether the fiem wil produce, shut down, or be indiferent between the two in the short run. Lastiy, determine whether e w make a prafit, suffer a loss, ar break even at each price. Price Quantity (Dollars per jacket) (Jackets) Produce or Shut Down? Profit or Loss? 4 12 36 48 60
- The let graph shows the world market for wheat. The right graph shows the cost curves and the marginal revenue curve of an individual wheat farmer at the initial long-run equilibrium The world population increases. In the left graph, draw the new demand curve. Label it Draw the market supply curve that returns the wheat market to its long-run equilibrium. Label it Draw a point to show the new long-run equilibrium price and quantity In the right graph, draw a point to show the firm's price and quantity in the long run >>>Draw only the objects specified in the question 16 124 Price (dollars per bushel) 10 P₁ 05 10 15 20 25 30 35 40 Quantity (bons of bushels per year) C Price and cost (dollars per bushel) 20 MC 10 ATC 124 M 10 MAR 200 650 100 150 200 250 300 350 400 Quantity (thousands of bushels per year) 0 a 3Use the information in the graphs below to answer the following questions SAb $/gal 25- S1 25 H MC ATC 20 20 15 15 P1 10 10 P2 5 4 6 8 10 2. Thousands of gal/week 1 3 Millions of gal/week What is the long-run equilibrium price in this market? Please enter your answers as whole numbers with and do not type out your answer in words (ie. $5 or $5.00 not "Five dollars"). How many gallons per week will the individual firm produce to maximize profits in equilibrium? Please enter your answers as whole numbers with no extra words (ie. 5000 not "5000 gallons/week"). What is the individual firm's long run economic profit?The following graph plots daily cost curves for a firm operating in the competitive market for fitness trackers. Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates. PRICE(Dollars pertracker) 100 90 70 60 50 40 20 10 0 0 MO ATC AVC 50 60 70 80 10 20 30 40 QUANTITY (Thousands of trackers per day) 90 100 Profit or Loss In the short run, given a market price equal to $45 per tracker, the firm should produce a daily quantity of trackers. On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of $45 and the quantity of production from your previous answer. Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss. The rectangular area represents a short-run thousand per day for the firm.