# Q represents market quantity and q represents firm

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Chapter 6 / Exercise 71
Intermediate Algebra
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Q represents market quantity and q represents firm quantity. a) Given the above information write an equation for the market supply curve. Explain how you found this equation. b) Given the market supply curve you found in (a), calculate the short run market equilibrium quantity and price in this market. How many units of output will the representative firm produce in the short run? Calculate the short-run profits for the representative firm. Explain your work. c) Given your calculations in (b), will the representative firm produce in the short-run? Explain your answer. d) Given your answer in (b), what do you predict will happen in the long-run in this industry? e) Given no changes in the firm’s cost curves or the market demand curve, calculate the following and explain how you found your answers: Long-run equilibrium market price = _________________________ Long-run equilibrium market quantity = _______________________ Level of production by the representative firm = ___________________ Approximate number of firms in industry in the long-run (this will not be a whole number) = _________________ 3. Consider a monopoly that produces widgets. Suppose you are told that the monopoly has the following cost curves where TC is total cost measured in dollars, Q is the quantity of widgets, and P is the price per widget in dollars: Total Cost: TC = 4 + 4Q + Q 2
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The document you are viewing contains questions related to this textbook. The document you are viewing contains questions related to this textbook.
Chapter 6 / Exercise 71
Intermediate Algebra
Mckeague Expert Verified
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