ECO 304K - HW 4 - b(3 points Draw the long run supply curve...

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HW #4 Economics 304K: Principles of Microeconomics Prof. Meg Ledyard Due Thursday, 11/01/07 (25 Points total) Remember to type the homework except for charts and graphs. In order to get full credit, you must show all of your work. Homework is due in class on the date listed above. Question 1: (4 points) Draw a graph of a perfectly competitive market and show Consumer Surplus and Producer Surplus. Question 2: (5 points) Suppose that a firm in a perfectly competitive market has a minimum ATC of 2000 at a quantity of 50 and a minimum AVC of 1000 at a quantity of 25. a. (2 points) What is the long run price in the market?
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Unformatted text preview: b. (3 points) Draw the long run supply curve for the market. Question 3: (6 points) Suppose that a monopoly producer of masks faces the following demand curve. Q P 0 50 1 48 2 43 3 36 4 27 5 11 Solve for the TR and MR for the firm. Question 4: (10 points) Suppose that Amanda is the monopoly producer of handbags in the world. In a well labeled diagram, show the following: the monopoly price (P M ), the quantity Amanda will produce (Q M ), the efficient quantity (Q Eff ), CS when the price is P M , and the DWL from producing Q M ....
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