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A: Given information: q = q1+q2+q3P=14-3qci(qi)=2qi2
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Suppose there are in total 3 firms in the market. Firm 1 decides its output first, then Firm 2 and Firm 3 decide their outputs simultaneously. The inverse demand function is p = 20-3q, where q = q1+q2+q3, and each firm's cost function is ci(qi) = 5qi2. What is the quantity that Firm 1 produces? Round your answer to 2 decimal points.
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- Suppose there are in total 3 firms in the market. Firm 1 decides its output first, then Firm 2 and Firm 3 decide their outputs simultaneously. The inverse demand function is p = 14 – 3q, where q = q1 + q2 + 43, and each firm's cost function is c(q.) = 2q?. What is the quantity that Firm 1 produces? Round your answer to 2 decimal points. Answer: The correct answer is: 1.04The inverse demand for tea is given by P = 8 – 0.03Q, where Pis the price per a gram of tea and Q is the total number of grams of tea brought to market. There are two tea shops in the market. Shop 1's cost function is given by C = 0.02q,?, where q, is the number of grams of tea it brings to market. Shop 2's cost function is given by C2 = 0.02q22, where q2 is the number of grams of tea it brings to %3D %3D market. Given that the two shops compete by setting output (Cournot), answer the following. a) Identify shop 1's reaction function to shop 2's output to within 2 decimal places (e.g. 0.33). 91= Number Number 92 b) Identify shop 2's reaction function to shop 1's output to within 2 decimal places (e.g. 0.71). q2= Number Number 91 c) To within two decimal places (e.g. 0.63) what is the equilibrium output level of each shop and the equilibrium per gram price for tea. Shop 1 will produce Number grams of tea and shop 2 will produce Number grams of tea. The equilibrium market price is £…The inverse demand for tea is given by P= 10 – 0.04Q, where Pis the price per a gram of tea and Qis the total number of grams of tea brought to market. There are two tea shops in the market. Shop 1's cost function is given by C = 0.01q,?, where qı is the number of grams of tea it brings to market. Shop 2's cost function is given by C2 = 0.01q2², where qp is the number of grams of tea it brings to market. Given that the two shops compete by setting output (Cournot), answer the following. a) Identify shop 1's reaction function to shop 2's output to within 2 decimal places (e.g. 0.33). 91= Number - Number 92 b) Identify shop 2's reaction function to shop 1's output to within 2 decimal places (e.g. 0.71). q2= Number Number 91 c) To within two decimal places (e.g. 0.63) what is the equilibrium output level of each shop and the equilibrium per gram price for tea. Shop 1 will produce Number grams of tea and shop 2 will produce Number grams of tea. The equilibrium market price is £ Number
- Two farmers produce milk for local town with local milk demand given by Q=100-1/3P (P denotes price measured in Rands, Q denotes the quantity measured in litres). Both farmers have the same cost function given by TC=150+2q (where q denotes output)a. What output should farmer 1 produce if he or she expects their rival to produce 20 units?Suppose a firm engaged in the illegal copying of DVD’s has a daily short run total cost function given by: STC = (q^2)+25 If pirated DVD’s sell for $20, how many will the firm copy each day? What will its profits be? What is the firm’s short run producer surplus at P=20? Develop a general expression for this firm’s producer surplus as a function of the price of pirated DVD’s.Giocattolo is a profit-maximizing firm producing toy cars, which it can produce and sell in its home country, Italy, and abroad in Spain. The average cost (AC) curve on the following graph represents Giocattolo's cost of producing toy cars within one factory, whether in Italy or in Spain. COST (Dollars per toy car) 10 1 0 10 I 1 20 30 40 50 60 70 80 QUANTITY (Thousands of toy cars) AC 90 100 Suppose that at the current market price of toy cars, the demand for Giocattolo's product is 10,000 toy cars per year in Italy and 20,000 toy cars per year in Spain. (Hint: Select each point on the previous graph to see its coordinates.) (?) Based on Giocattolo's average cost curve, within one factory it can produce 20,000 toy cars at S per toy car, and produce the total of 30,000 toy cars at S per toy car. Complete the following table by indicating Giocattolo's total production cost for each scenario. Total Production Cost (Dollars) Scenario Produce 10,000 toy cars in Italy and 20,000 toy cars in…
- There are two types of goat milk consumers in the market: Elves and Hobbits. Elves' inverse demand function is pE(g) = 10 – 8qE , and Hobbits' inverse demand function is pH(p) = 12 – 7qH . Suppose the market has only one goat milk producer, Dolf, whose cost function is C(q) = 4q. Dolf can easily tell the difference between Elves and Hobbits, and he can charge different prices for Elves and Hobbits respectively. What will Dolf's total profits be? Round your answer to 2 decimal points. Answer: 191 The correct answer is: 3.41Firm A and Firm B sell identical goods The total market demand is:Q(P) = 1,000-1.0P The inverse demand function is therefore: P(QM) = 10,000-10QM QM is total market production (i.e., combined production of firm’s A and B). That is: QM = QA + QB As a result, the inverse demand curve for each firm is: P(QA,QB) = 10,000-10QA-10QB The difference between this example and the example in class is that the two firms have different costs. Firm A has the same cost as in class, but firm B has a different cost function: TCA(QA) = 5000QA TCB(QB) = 5000QB Using the demand function and the cost functions above, what is firm A’s profit function? Using the profit function above and assuming that firm B produces QB, calculate what firm A’s best response is to firm B’s decision to produce QB. (Note: Firm A’s best response should be a function of QB) Using the demand function and the cost functions above, what is firm B’s profit function? Using the profit function above and assuming that firm A…Let us consider an economic sector characterized by the following data. The (inverse) demand function is p = 20 -2g with q the quantities produced by the firms in the sector and p the price. The total cost of production for any firm in the sector is: CT(a) = q* - 4g +5 a) First, assume that there is only one firm, firm 1, in the industry. Calculate the price, quantity produced and profit of firm 1 in a monopoly situation that wants to maximize its profit b) Firm 1 seeks to deter the entry of another firm, firm 2, into its market through a sustainable monopoly strategy. Calculate the equilibrium price, quantity and profit of firm 1 given this strategy
- Consider the competitive market for dress shirts. 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. For each price in the following table, use the graph to determine the number of shirts this firm would produce in order to maximize its profit. Assume that when the price is exactly equal to the average variable cost, the firm is indifferent between producing zero shirts and the profit-maximizing quantity. Also, indicate whether the firm will produce, shut down, or be indifferent between the two in the short run. Lastly, determine whether it will make a profit, suffer a loss, or break even at each price.Suppose that the market for cashmere sweaters is a competitive market. The following graph shows the daily cost curves of a firm operating in this market. Hint: After placing the rectangle on the graph, you can select an endpoint to see the coordinates of that point. In the short run, at a market price of $45 per sweater, this firm will choose to produce sweaters per day. On the preceding graph, use the blue rectangle (circle symbols) to shade the area representing the firm’s profit or loss if the market price is $45 and the firm chooses to produce the quantity you already selected. Note: In the following question, enter a positive number, even if it represents a loss. The area of this rectangle indicates that the firm’s would be thousand per day in the short run.A firm's demand function is Q = 16 -P and its total cost function is defined as TC = 3 + Q+ 0.25Q² Use these two functions to form the firm's profit function and then determine the level of output that yields the profit maximum. What is the level of profit at the optimum?