Long-run equilibrium market price-quantity of lumber

Assignment Help Business Management
Reference no: EM131191554

Please answer all of a, b, and c

The lumber industry (lumber is wood used in manufacturing) in a city is a perfectly competitive industry. The long-run cost function for a lumber firm is C(q)^2 +1000 where q is a standardized amount of lumber. The market demand in the city is ,000-20*P.

a. Find the long-run equilibrium market price and quantity of lumber. How many firms will be in the market?

b. The government decides to impose a per-unit quantity tax of on the suppliers; if a firm sells one unit they must pay 50 to the government. Find the short-run equilibrium price and quantity after the tax is imposed. What is the profit of each firm? Note: to keep things simple, assume an individual firm's long-run marginal cost is the same as their short-run marginal cost.

c. Now find the new long-run equilibrium price and quantity with the tax. How many lumber firms will be in the market? Draw a diagram comparing the equilibrium price and quantity in the three situations: 1) before the tax 2) the short-run after the tax 3) the long-run after the tax.

Reference no: EM131191554

Questions Cloud

Explain the financial ratios by detailing the relevancy : Explain the financial ratios by detailing the relevancy, interpretation, and what each ratio means relative to the financial health, investor perspective, and stakeholder perspective.
Purchased new equipment to improve labor productivity : Your company makes common coffee mugs and you purchased new equipment to improve labor productivity. For the last few years your production line consisted of six workers earning 10.20 per hour making a 650 cups per hour. The original machines cos..
Determine the claims of the tenant and the landlord : The landlord is able to show months of texts and notes begging for the rent from the tenant. What are the legal considerations you would evaluate to determine the claims of the tenant and the landlord? In whose favor would you rule, and why? Be su..
Distorted for a variety of reasons : i) Consumers' perceptions may be distorted for a variety of reasons, including: (a) physical appearances; (b) stereotypes; (c) first impressions; (d) jumping to conclusions; and (e) the halo effect. Explain how three of these factors may work to d..
Long-run equilibrium market price-quantity of lumber : The lumber industry (lumber is wood used in manufacturing) in a city is a perfectly competitive industry. The long-run cost function for a lumber firm is C(q)^2 +1000 where q is a standardized amount of lumber. The market demand in the city is ,0..
Slow economic growth : Why is it that the US has such slow economic growth, but has one of the best economies in the world?
Compute the data and draw a curve of ag/q versus depth : On the basis of this plot, make a statement relative to the range within which loaded areas may be considered to act as point loads. (After Taylor, 1948.)
Design a precision full wave rectifier : Design a precision full-wave rectifier as shown in Fig.(a) to provide a voltage gain of Af = vO ⁄ vS = 50. The input voltage is vS = 0.01 sin (200πt).
Estimate the stresses at a depth of 20 m below ground : Estimate the stresses at a depth of 20 m below ground surface at each of the following locations: (0,0), (0, 15), (6,0), (6, 15), and (10,25); obtain values by both Boussinesq and Westergaard methods, and also determine the ratio of the stresses a..

Reviews

Write a Review

Business Management Questions & Answers

  Show team trust

Have you experienced a previous situation involving a team where different directions became an issue that affected the end result of a team project or task? Did it affect it positively? Negatively?

  How are customer results as well as investor results

How are customer results as well as investor results synergistic and how may they conflict with one another?

  Can words or conduct of a supposed or alleged agent

Can words or conduct of a supposed (alleged) agent alone create an apparent agency or are words or conduct of a principal likewise

  What is the focus of the strategic cio

How does the traditional role of a CIO differ from the IT strategic role of a CIO? What is the focus of the strategic CIO? Why is the role of strategic CIO emerging?

  Possible from coercive forces

In a medical context, we are very concerned about informed consent in medical research and treatment, with the goal of consent being a choice freed as much as possible from coercive forces. In light of the above discussion, is it possible to get c..

  Attitude toward public administration and administrators

Explain how your attitude toward public administration and public administrators has changed. If it has not changed, explain why.

  The more appropriate basis of overhead application

What would be the more appropriate basis of overhead application: printing press machine hours or direct labor hours? Given the choice of driver, are there any implications to consider for under or over applied overhead?

  Sources of conflictof the sources of conflict which one do

sources of conflictof the sources of conflict which one do you believe that as a manager you could exert the most

  While most other discounters offer a predictable assortment

While most other discounters offer a predictable assortment of merchandise, the styles and brands offered at off-price retailers change frequently because they buy only illustrate what is presently available at a good deal.

  Jim and laura buyer visit the local car dealership

Jim and Laura Buyer visit the local car dealership because they are interested in buying a new car. The car they currently have is aging and is starting to have mechanical problems. Jim and Laura would share the new car, and use it to go back and for..

  Show important factors that should be in the project review

List five important factors that should be in the project review and is it important to tell the sponsors what they want to hear, or the truth about the actual status of the project?

  Explain planning is everything

Explain PLANNING IS EVERYTHING and How can IMC principles move us up the pyramid

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