--%>

Question on ATC and MC

A perfectly competitive market within the long period:

Data
         firm A:  ATC = y2   4y + 12 and MC = 3y2 – 8y + 12
         firm B:  ATC = y2   4y + 10 and MC = 3y2 – 8y + 10
         firm C:  ATC = y2   4y + 8 and MC = 3y2 – 8y + 8
         market demand curve:  ym = 200   20py
Questions
a. Suppose that the minimum ATC for each of the firms takes place when they generate two units of output.  If the auctioneer calls out a market price of $6.00 that firm will ought to leave the market and why.
b. Find out the long period equilibrium market price, equilibrium market output, and the number of firms into the market.
c. If the market demand curve shifted towards the right and becomes 300 – 15py what would be the new equilibrium market price & market output?
d. Do the results of (b) and (c) support a supply and demand determination of the market price? Describe.

   Related Questions in Microeconomics

  • Q : Price taker in perfect competition

    State how is a single buyer a price taker in the perfect competition? Answer: A single buyer’s share in total market demand is too significant that the buyer

  • Q : Founder of Utilitarianism I have a

    I have a problem in economics on Founder of Utilitarianism. Please help me in the following question. The utilitarianism founder in England was: (i) Rupert Brooke. (ii) Jeremy Bentham. (iii) Thomas Dewey. (iv) John Stuart Mill. (v) Adam Smith.

    Q : Slope of ray by origin in price

    The slope of the ray by the origin which is tangent to point b equivalents to: (w) the reciprocal of the price elasticity of demand. (x) P / Q. (y) 0a / 0c. (z) the price elasticity of supply.

    Q : Slopes of demand and supply curves The

    The slopes of demand and supply curves are frequently: (w) misleading as guides to price elasticities. (x) independent of the units measuring changes in price and quantity. (y) highly dependent upon each other. (z) used to forecast changing consumer t

  • Q : Intermediaries earn income to help

    In the long run within a market system, all intermediaries earn income only when they help sellers and buyers: (w) raise surpluses. (x) by innovating new products. (y) reduce transaction costs. (z) ga

  • Q : Burden of tax reduce on suppliers of

    Most of the burden of an excise (i.e., per unit) tax would be borne through consumers of the taxed good, although some of the tax burden would reduce on suppliers of the good demonstrated in: (w) Panel A. (x) Panel B. (y) Panel C. (z)

  • Q : Automation process I have a problem in

    I have a problem in economics on Automation process. Please help me in the following question. The procedure of substituting complicated machinery for human labor is termed as: (1) automation. (2) Bionic engineering. (3) Robotics. (4) Scientific manag

  • Q : Supply curve Select the right answer of

    Select the right answer of the question. A supply curve that is a vertical straight line indicates that: A) production costs for this product cannot be calculated. B) the relationship between price and quantity supplied is inverse. C) a change in price will have no ef

  • Q : Efficient purely competitive market in

    When there are no externalities, in that case a purely competitive market in equilibrium is efficient since: (w) P = AC = MC. (x) total revenue equals total cost [TR = TC]. (y) P = MSB = MSC = MC. (z) MSB = MSC = MR > P.

  • Q : Types of elasticity of supply Types of

    Types of elasticity of supply: There are five kinds of elasticity of supply:1. Perfectly elastic supply:

    Discover Q & A

    Leading Solution Library
    Avail More Than 1412338 Solved problems, classrooms assignments, textbook's solutions, for quick Downloads
    No hassle, Instant Access
    Start Discovering

    18,76,764

    1954144
    Asked

    3,689

    Active Tutors

    1412338

    Questions
    Answered

    Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!

    Submit Assignment

    ©TutorsGlobe All rights reserved 2022-2023.