$48 46 44 42 40 38 36 34 32 30 MC ATC Df= MR 28 26 24 AVC 22 20 18 16 14 12 10 AFC 8. 6. 4 Quantity 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 7.5 8 8.5 9 9.5 10

Suppose a corn dog stand market is perfectly competitive and in long-run equilibrium. One day, the city starts imposing a $300 per year tax on each stand. How does this policy impact the number of corn dogs produced and sold in the market in the short run and long run? Down in the short run and no change in the long run No change in the short run and down in the long run Up in the short run and no change in the long run No change in the short run and up in the long run

Use the table Costs for Alina's Apple Pies. If Alina's Apple Pies operates in a perfectly competitive market and the market price for a pie is $18, how many pies should Alina's Apple Pies produce  and what is the economic profit or loss per unit?

Consider the perfectly 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. PRICE AND COST PER UNIT (Dollars) 100 90 80 70 60 40 30 20 10 0 0 ☐ ☐ MC ■ ATC AVC 70, 85 ■ 10 20 30 40 50 60 70 80 90 QUANTITY OF OUTPUT (Thousands of shirts) 100 ?

A market in perfect competition is in long-run equilibrium. What happens to the market if labor unions are able to increase wages for workers? Include a detailed set of graphs showing both the market and firm long run equilibration in reaction to the change.

Why don't firms in a competitive market have excess capacity in the long run?

9.7. A producer operating in a perfectly competitive market has chosen his output level to maximize profit. At that output, his revenue and costs are as follows: Revenue Variable costs $200 $120 $60 Sunk fixed costs Nonsunk fixed costs $40 Calculate his producer surplus and his profits. Which (if either) of these should he use to determine whether he should exit the market in the short run? Briefly explain. 9.8. Dave's Fresh Catfish is a northern Mississippi farm that operates in the perfectly competitive catfish farming industry. Dave's short-run total cost curve is STC(Q) = 400 + 2Q + 0.5Q², where Q is the number of catfish harvested per month. The corresponding short-run marginal cost curve is SMC(Q)=2+ Q. All of the fixed costs are sunk. a. What is the equation for the average variable cost (AVC)? b. What is the minimum level of average variable costs? c. What is Dave's short-run supply curve?

What is the most important decision a perfectly competitive firm must make in order to maximize profit? what quantity to produce what price to charge what quality to produce what quantity of labor is needed

Q3

In Problem 5, the market demand decreases and the demand schedule becomes: If firms have the same costs set out in Problem 5, what is the market price and the firm’s economic profit or loss in the short run? Problem 5 The market for paper is perfectly competitive and 1,000 firms produce paper. The table sets out the market demand schedule for paper. The table in the next column sets out the costs of each producer of paper. Calculate the market price, the market output, the quantity produced by each firm, and the firm’s economic profit or loss.