Suppose the market for lemonade is competitive market

Assignment Help Business Economics

Reference no: EM13896980

Suppose the market for lemonade is a competitive market. The prevailing market price is $10. A typical seller in the market has a cost function of: C = q3 - 6q2 + l0q + 100

a. Find its profit-maximizing output level. Calculate her profit.

b. What is the lowest price a typical seller is willing to accept in the short run? Explain with calculation.

c. Given the result in (a), what will happen to the market price in the long run? Explain briefly in words.

Reference no: EM13896980

Questions Cloud

What is the expected value of the lottery ticket : Suppose Ann’s utility function is defined as: u(c) = ln(c) . For her birthday, Ann’s father offers her the choice of either a lottery ticket that is worth $1 with probability .99 and worth $100,000 with probability .01 or $500 cash. What is the expec..

What is the status of mediator qualification in nevada : What is your opinion in the confidentiality versus good-faith requirement controversy as it applies in Nevada and What is the status of mediator qualification in Nevada?

Economics game theory : Consider the Cournot duopolists firm 1 and firm 2. They produce homogeneous products and simultaneously choose quantities q1 and q2, respectively. Each firm is trying to maximize his own profit. From firm 1’s profit maximization, derive firm 1’s best..

Relationships between leader and follower : To add to your post, leaders should strive for inclusion. According to Graen and Uhl-Bien (1995), Leader-Member Exchange Theory (there is a great discussion on this theory in this week's chapter) says there are basically two types of relationships..

Suppose the market for lemonade is competitive market : Suppose the market for lemonade is a competitive market. The prevailing market price is $10. A typical seller in the market has a cost function of: C = q3 - 6q2 + l0q + 100. Find its profit-maximizing output level. Calculate her profit. What is the l..

Compare effectiveness of twoweek and six-week moving average : Compare the effectiveness of two-week, four-week, and six-week moving averages. Which should you use to forecast copier paper use during the next week?

Discuss all of the steps of the collective bargaining proces : Define and discuss what collective bargaining is. Research, outline, and discuss all of the steps of the collective bargaining process.

Create a compelling future : Some principles of the Grass Roots Model include the acronym CLIMB: Create a compelling future; Let the customer drive the organization; Involve every mind; Manage work horizontally, and Build personal credibility

Effective management of resources is a key contributor : Effective management of resources is a key contributor to the success of an organization

User Account

All Pages