Draw correctly labeled side-by-side graphs

Assignment Help Microeconomics
Reference no: EM133396111

Question: In answering the question, you should emphasize the line of reasoning that generated your results; it is not enough to list the results of your analysis. Include correctly labeled diagrams, if useful or required, in explaining your answers. A correctly labeled diagram must have all axes and curves clearly labeled and must show directional changes.

Bestmilk, a typical profit-maximizing dairy firm, is operating in a constant-cost, perfectly competitive industry that is in long-run equilibrium.

Draw correctly labeled side-by-side graphs for the dairy market and for Bestmilk and show each of the following.

Price and output for the industry

Price and output for Bestmilk

Assume that milk is a normal good and that consumer income falls. Assume that Bestmilk continues to produce. On your graphs in part (a), show the effect of the decrease in income on each of the following in the short run.

Price and output for the industry

Price and output for Bestmilk

Area of loss or profit for Bestmilk

Following the decrease in consumer income, what must be true for Bestmilk to continue to produce in the short run?

Assume that the industry adjusts to a new long-run equilibrium. Compare the following between the initial and the new long-run equilibrium.

Price in the industry

Output of a typical firm

The number of firms in the dairy industry

Reference no: EM133396111

Questions Cloud

Calculate the marginal product and the marginal cost : Calculate the marginal product and the marginal cost b. Calculate variable and total costs for every level of production. Use the Excel template provided
What indicators will tell you if you are successful : What problem do you want to solve? What opportunities do you see? What new product, service, etc. are you thinking about (general description) Who may benefit
How many customers are waiting for ambulance to dispatched : On average, how long does it take from the time a person calls the ambulance dispatcher until he or she is delivered to the hospital?
Discuss cost estimation for running a banking application : On-premise cost estimation for running a banking application vs cost estimation of moving to cloud. Explain or support your answer in terms of quantitative
Draw correctly labeled side-by-side graphs : Bestmilk, a typical profit-maximizing dairy firm, is operating in a constant-cost, perfectly competitive industry that is in long-run equilibrium
What can be said about the bundle : Suppose that a consumer's income is given by What can be said about the bundle
Why is target doing well what is their success factor : Why is Target doing well? What is their success factor? Should they expand? Why or why not? (Expansion takes on many forms!) What do they need to consider
How do technology and input prices affect cost functions : How do technology and input prices affect cost functions? Use the anecdotes in the article about technologies and input prices, as well as your answer
How an opinion poll be used to shed insight on : What is an opinion poll. Use an example to illustrate how an opinion poll be used to shed insight on a particular topic/issue/phenomenon.

Reviews

Write a Review

Microeconomics Questions & Answers

  The free rider problem

Question: Explain why the free rider problem makes it difficult for perfectly competitive markets to provide the Pareto efficient level of a public good.

  Failure of the super committee is good thing for economy

Some commentators have argued that the failure of the “Super committee” is good thing for the economy?  Do you agree?

  Case study analysis about optimum resource allocation

Case study analysis about optimum resource allocation: -  Why might you suspect (even without evidence) that the economy might not be able to produce all the schools and clinics the Ministers want? What constraints are there on an economy's productio..

  Fixed cost and vairiable cost

Questions:  :   Which of the following are likely to be fixed costs and which variable costs for a chocolate factory over the course of a month?  Explain your choice.

  Problem - total cost, average cost, marginal cost

Problem - Total Cost, Average Cost, Marginal Cost: -  Complete the following table of costs for a firm.  (Note: enter the figures in the  MC   column  between  outputs of  0 and 1, 1 and 2, 2 and 3, etc.)

  Oligopoly and demand curve problem

Problem based on Oligopoly and demand curve,  Draw and explain the demand curve facing each firm, and given this demand curve, does this mean that firms in the jeans industry do or do not compete against one another?

  Impact of external costs on resource allocation

Explain the impact of external costs and external benefits on resource allocation;  Why are public goods not produced in sufficient quantities by private markets?  Which of the following are examples of public goods (or services)? Delete the incorrec..

  Shifts in demand and movements along the demand curve

Describe the differences between shifts in demand and movements along the demand curve. What are the main factors which can shift the demand curve? Explain why they cause the demand curve to shift. Use examples and draw graphs to support your discuss..

  Article review question

Article Review Question: Read the following excerpts from the article "Fruit, veg costs surge' by Todd, Dagwell, published in the Herald on January 25th 2011 and answer questions below:

  Long-term growth, international trade & globalization

Long-term Growth, International Trade & Globalization:- This question deals with concepts such as long-term growth, international trade and globalization. Questions related to trade deficit, trade surplus, gains from trade, an international trade sce..

  European monetary union (emu) in crisis

"Does the economic bailout of Spain and Greece spell the beginning of the end for the European Monetary Union (EMU)?"

  Development game “settlers of catan”

Read the rules of the game, the overview and the almanac for the Development Game "Settlers of Catan"

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd