HW I summer 2009

HW I summer 2009 - Bus 247 Homework Set 1 Summer 2009...

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Bus 247 Homework Set 1 Summer 2009 Queens College Professor Bradbury This assignment is due at the beginning of class on Monday June 15. The assignment must be typed and stapled in order to receive credit. (though graphical solutions may be handwritten in spaces provided on your printed solutions). You may wish to bring two copies to class, one to turn in and one to follow along with as we review the solutions. 1) If a firm is producing where marginal cost is below average cost what must be true of average cost? 2) When a firm experiences economies of scale everywhere what must be true of average cost? Would you regard this firm as a Natural Monopoly? 3) Using the following cost function, specify fixed and variable costs then derive the marginal costs function. C(q) = 10 + 2q + 3q 2 4) In a perfectly competitive model firms are price takers, total revenue for the perfectly competitive firm is equal to pq . Derive marginal revenue and average revenue. 5) In your own words use the notion of diminishing marginal returns to explain the
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This note was uploaded on 02/15/2011 for the course ECON 247 taught by Professor Bradberry during the Fall '10 term at CUNY Queens.

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HW I summer 2009 - Bus 247 Homework Set 1 Summer 2009...

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