extra_questions_supply_soln

extra_questions_supply_soln - Econ 1101 Practice Questions...

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1 Econ 1101 Practice Questions about Supply in the Short and Long Run: (Solution) 1. Under what three assumptions will the long-run supply curve for the widget industry be perfectly elastic (i.e. perfectly flat) x. The same technology is available to all firms. .. The average total cost is falling (economies of scale) over the entire range of Q. x.. There are no barriers to entry in the industry. x. Input prices do not change as the industry expands .. The marginal revenue of the firm is greater than the price. 2. Each widget firm has the cost structure illustrated in the figure below on the left. Two different cases for industry demand are illustrated in the figure below on the right. Please use the gridlines in the graph to determine the numbers you need to do the problem. For example, you should be able to see in the figure that ATC at q = 2 is \$10. 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 0123456789 MC ATC AVC q \$ 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 0 200 400 600 800 1000 1200 1400 1600 1800 2000 2200 2400 Q \$ D1 D2 Profit S LR Cost Structure of Firm Industry Level Variables S SR N = 200

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This note was uploaded on 04/02/2011 for the course ECON 1101 taught by Professor Someguy during the Spring '07 term at Minnesota.

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extra_questions_supply_soln - Econ 1101 Practice Questions...

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