EBK INTERMEDIATE MICROECONOMICS AND ITS
12th Edition
ISBN: 9781305176386
Author: Snyder
Publisher: YUZU
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Question
Chapter 9, Problem 9.6P
a)
To determine
the industry’s long-run supply schedule.
b)
To determine
To Calculate: the following:
- Long-run
equilibrium price - The total industry output
- The output of each firm
- The number of firms
- The Profits of each firm
c)
To determine
the short-run average and marginal cost curves and also the calculate the output level in short-run average cost reach a minimum.
d)
To determine
To Calculate: the short-run supply curve for each firm and also the industry short-run supply curve.
e)
To determine
To Calculate: the answer part (b) for the very short-run, when firm’s cannot change their outputs using given demand curve.
f)
To determine
To Calculate: the answers to part (b) using the short-run supply curve in the short-run.
g)
To determine
To Calculate: the new long-run equilibrium for the industry.
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A perfectly competitive industry has a large number of potential entrants. Each firm has an identical cost structure such that long-run average cost is minimized at an output of 20 units (qi) =20. The minimum average cost is $10 per unit. Total market demand is given by ? = 1,500 − 50?a. What is the industry’s long-run supply schedule?b. What is the long-run equilibrium price (p*)? The total industry output (Q*)? The output of each firm (O*)? The number of firms? The profits of each firm? c. The short-run total cost function associated with each firm’s long-run equilibrium output is given by ?(?) = 0.5?2 − 10? + 200Calculate the short-run average and marginal cost function. At what output level does short run average cost reach a minimum? d. Calculate the short-run supply function for each firm and the industry short-run supply function.e. Suppose now that the market demand function shifts upward to Q =2,000 - 50P. Using this new demand curve, answer part (b) for the very short run…
A perfectly competitive industry has a large number of potential entrants. Each firm has an identical cost structure such that long-run average cost is minimized at an output of 20 units (qi) =20. The minimum average cost is $10 per unit. Total market demand is given by ? = 1,500 − 50? .
What is the industry’s long-run supply schedule?
a) Find the long run equilibrium price. Find the minimum efficient scale of the typical firm. Find the typical firm’s average cost when it operates at minimum efficient scale. In the long run, what price will prevail in this market? In words, clearly justify your answer.
Suppose demand is QD = 3,200 – 100P.
(b) Explain why you expect the number of firms in this market to be fifty-five. In this market, what is the short run supply function of the typical firm? What is the short run market supply function?
Suppose the local government introduced a $90 licensing fee that raised the fixed cost from $160 to $250.
c) Would the introduction of the licensing fee affect the short run equilibrium price or quantity? Justify your answer? Clearly explain why you expect that in the long run fewer larger firms will operate in this market. After the introduction of the licensing fee, what is the new long run equilibrium price? How many firms will survive in this market?
Chapter 9 Solutions
EBK INTERMEDIATE MICROECONOMICS AND ITS
Ch. 9.2 - Prob. 1MQCh. 9.2 - Prob. 2MQCh. 9.2 - Prob. 1TTACh. 9.2 - Prob. 2TTACh. 9.4 - Prob. 1MQCh. 9.4 - Prob. 2MQCh. 9.5 - Prob. 1MQCh. 9.5 - Prob. 2MQCh. 9.8 - Prob. 1MQCh. 9.8 - Prob. 2MQ
Ch. 9.8 - Prob. 1TTACh. 9.8 - Prob. 2TTACh. 9.9 - Prob. 1MQCh. 9.9 - Prob. 2MQCh. 9.9 - Prob. 1TTACh. 9.9 - Prob. 2TTACh. 9.10 - Prob. 1MQCh. 9.10 - Prob. 2MQCh. 9.10 - Prob. 1TTACh. 9.10 - Prob. 2TTACh. 9.10 - Prob. 1.1MQCh. 9.10 - Prob. 2.1MQCh. 9.10 - Prob. 3.1MQCh. 9.10 - Prob. 1.1TTACh. 9.10 - Prob. 2.1TTACh. 9.10 - Prob. 1.2MQCh. 9.10 - Prob. 2.2MQCh. 9.10 - Prob. 3.2MQCh. 9 - Prob. 1RQCh. 9 - Prob. 2RQCh. 9 - Prob. 3RQCh. 9 - Prob. 4RQCh. 9 - Prob. 5RQCh. 9 - Prob. 6RQCh. 9 - Prob. 7RQCh. 9 - Prob. 8RQCh. 9 - Prob. 9RQCh. 9 - Prob. 10RQCh. 9 - Prob. 9.1PCh. 9 - Prob. 9.2PCh. 9 - Prob. 9.3PCh. 9 - Prob. 9.4PCh. 9 - Prob. 9.5PCh. 9 - Prob. 9.6PCh. 9 - Prob. 9.7PCh. 9 - Prob. 9.8PCh. 9 - Prob. 9.9PCh. 9 - Prob. 9.10P
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