To compute the number of firms in the industry

Reference no: EM13200894

since the AC curve in the problem is upward-sloping everywhere, it is not possible to construct a zero-profit equilibrium given the assumptions of the problem (this outcome requires a U-shaped AC curve). this problem will consider an alternative example where a long-run equilibrium exists. let the total cost function for an individual firm be give by C = 240Q - 40Q^2 + 2Q^3. compute average cost for Q = 1, 2, 3,...,14, 15.

a) using your results, find the long-run equilibrium price in the market. this price is given by p = ?, and output per firm is Q = ?.

b) suppose that the (inverted) market demand curve for the product is given by Q = 50000 - 10000P. what total quantity is demanded at the long-run equilibrium price?

c) from (b), you know how much total output must be delivered by all firms operating int he long-run equilibrium. using this number along with the results from part (a), compute the number of firms in the industry in the long-run equilibrium. this number is ?

Reference no: EM13200894

Questions Cloud

How many medical test kits were sold last year : This year, 230 million test kits are expected to be sold. this represents a 122% increase from the number of kits that were sold last year. How many medical test kits were sold last year?

How quickly is revenue changing : The price function for selling Squinks is p = 180 - 7x. Sales are 38 per day and dropping at 5 per day. How quickly is revenue changing?

What will happen in the industry in the long run : Explain why this firm would not try to sell more output by undercutting the market price. A calculation is not necessary but you may choose to use it as your explanation. What will happen in this industry in the long run

Currency forward market and a futures market : Explain the basic differences between the operation of a currency forward market and a futures market and calculate the intrinsic value and the time value of the call and the put option.

To compute the number of firms in the industry : since the AC curve in the problem is upward-sloping everywhere, it is not possible to construct a zero-profit equilibrium given the assumptions of the problem this outcome requires a U-shaped AC curve.

What is the least number of cups of lemonade : carolyn and kim are selling lemonade this summer. It cost $0.10 to make each cup pf lemonade . they are going to sell each cup of lemonade for $0.25 . What is the least number of cups of lemonade they need to sell in order to collect $10.00 more t..

What quantity of gps devices will the firm produce : A firm produces GPS devices in a monopolistically competitive market and has the following cost function: TC = 270 + 40Q + 2Q2 MC = 40 + 4Q Demand for this firm's product is given as: QD = 500 - 2P a) To maximize profits,what price will it charge

Find the best predicted value of the response variable : Use the given data to find the best predicted value of the response variable.

What radial and height dimensions will require : Metal storage tank with a maximum volume of 1500 m^3 is to be constructed in the shape of a right circular cylinder surmounted by a hemisphere. What radial and height dimensions will require the least amount of material?

User Account

All Pages