Essentials of Economics (MindTap Course List)
8th Edition
ISBN: 9781337091992
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 13, Problem 10PA
Subpart (a):
To determine
Calculate the marginal cost,
Subpart (b):
To determine
Total supply in the market.
Subpart (c):
To determine
Long run profit.
Subpart (d):
To determine
Long run supply.
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Students have asked these similar questions
An industry currently has 100 firms, each of which has fixed cost of $16 and averagevariable cost as follows:Quantity Average Variable Cost1 $ 12 23 34 45 56 6a. Compute a firm’s marginal cost and average total cost for each quantity from 1 to 6.b. The equilibrium price is currently $10. How much does each firm produce? What isthe total quantity supplied in the market?c. In the long run, firms can enter and exit the market, and all entrants have the samecosts as above. As this market makes the transition to its long-run equilibrium, willthe price rise or fall? Will the quantity demanded rise or fall? Will the quantitysupplied by each firm rise or fall? Explain your answers.
10. An industry currently has 100 firms, each of which has fixed cost of $16 and average variable cost as
follows:
TT
Quantity Average Variable Cost
1
$1
2
3
3
4
4
a. Compute a firm's marginal cost and average total cost for each quantity from 1 to 6.
b. The equilibrium price is currently $10. How much does each firm produce? What is the total
quantity supplied in the market?
c. In the long run, firms can enter and exit the market, and all entrants have the same costs as above.
As this market makes the transition to its long-run equilibrium, will the price rise or fall? Will the
quantity demanded rise or fall? Will the quantity supplied by each firm rise or fall? Explain your
answers.
d. Graph the long-run supply curve for this market, with specific numbers on the axes as relevant.
2.
Consider the attached diagram of a competitive market and the typical
firm operating in that market. In the long run, what total amount of the
product will be supplied in equilibrium? [Hint: what amount do
consumers demand at the long-run price?]
Price
28
24
20
500,000
700,000
D
Price, costs
60 66 78
MC
AC
Chapter 13 Solutions
Essentials of Economics (MindTap Course List)
Ch. 13.1 - Prob. 1QQCh. 13.2 - How does a competitive firm determine its...Ch. 13.3 - Prob. 3QQCh. 13 - Prob. 1CQQCh. 13 - Prob. 2CQQCh. 13 - Prob. 3CQQCh. 13 - Prob. 4CQQCh. 13 - Prob. 5CQQCh. 13 - Prob. 6CQQCh. 13 - Prob. 1QR
Ch. 13 - Prob. 2QRCh. 13 - Prob. 3QRCh. 13 - Prob. 4QRCh. 13 - Prob. 5QRCh. 13 - Prob. 6QRCh. 13 - Prob. 7QRCh. 13 - Prob. 8QRCh. 13 - Prob. 1PACh. 13 - Prob. 2PACh. 13 - Prob. 3PACh. 13 - Prob. 4PACh. 13 - Prob. 5PACh. 13 - A firm in a competitive market receives 500 in...Ch. 13 - Prob. 7PACh. 13 - Prob. 8PACh. 13 - Prob. 9PACh. 13 - Prob. 10PACh. 13 - Suppose that each firm in a competitive industry...
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