Question 3 Carl and Simon are two pumpkin growers who are the only sellers of pumpkins at the market. The demand function for pumpkins is Q = 1,800 – 400P, where Q is the total number of pumpkins that reach the market and P is the price of pumpkins. Suppose further that each farmer has a constant marginal cost of $.50 for each pumpkin produced. Assume that Carl can tell, by looking at Simon's fields, how many pumpkins Simon planted and how many Simon will harvest in the fall. (Suppose that Simon will sell every pumpkin that he produces.) Therefore, Carl sees how many pumpkins Simon is actually going to sell this year. Carl has this information before he makes his own decision about how many to plant. If Simon plants enough pumpkins to yield Q, this year, then Carl knows that the profit maximising amount to produce this year is QCarl = O 1,800 – 400QS- O 1,800 – 800QS- 800 – Qs/2. O 400 – Qs/2. O 1,200 – Qs-
Question 3 Carl and Simon are two pumpkin growers who are the only sellers of pumpkins at the market. The demand function for pumpkins is Q = 1,800 – 400P, where Q is the total number of pumpkins that reach the market and P is the price of pumpkins. Suppose further that each farmer has a constant marginal cost of $.50 for each pumpkin produced. Assume that Carl can tell, by looking at Simon's fields, how many pumpkins Simon planted and how many Simon will harvest in the fall. (Suppose that Simon will sell every pumpkin that he produces.) Therefore, Carl sees how many pumpkins Simon is actually going to sell this year. Carl has this information before he makes his own decision about how many to plant. If Simon plants enough pumpkins to yield Q, this year, then Carl knows that the profit maximising amount to produce this year is QCarl = O 1,800 – 400QS- O 1,800 – 800QS- 800 – Qs/2. O 400 – Qs/2. O 1,200 – Qs-
Chapter13: General Equilibrium And Welfare
Section: Chapter Questions
Problem 13.2P
Related questions
Question
V5
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning