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 : Market power at output market The

    The profit-maximizing firm which is perfectly competitive in the resource market however which consists of market power in the output market will hire the labor at a point where: (p) VMP = MRP = MFC = w. (q) VMP > MRP = MFC = w. (r) VMP = MRP = MFC > w. (s) VMP

  • Q : Help The problem of asymmetric

    The problem of asymmetric information is that: a) neither health care buyers nor providers are well-informed. b) health care providers are well-informed, but buyers are not. c) the outcomes of many complex medical procedures cannot be predicted. d) insurance companies are well-informed

  • Q : Caveat emptor-Laws and Regulations The

    The Caveat emptor is a prehistoric legal doctrine mainly based on the idea that buyer: (1) Are the finest judges of the value that they will receive when they purchase. (2) Must receive money back guarantees when products are flawed. (3) Need governme

  • Q : Problem on average retail price and the

    Table indicate the average retail price of milk and the Consumer Price Index in the year 1980 -1998. 1010_Average</span></p>
                                        </div>
                                        <!-- /comment-box -->
                                    </li>
   
   </td>
	</tr><tr>
		<td>
       
      <li>
                                        <div class=

    Q : Monopoly and competition theory The

    The theorist who set the stage for much of the “new” theory of international trade through blending theories of monopoly and competition to suit the case of several sellers offering differentiated products was: (1) Leon Walras. (2) Vilfred

  • Q : Best society according to Utilitarianism

    Utilitarianism states that the best society is one which gives the: (1) Essential goods to meet people’s requirements. (2) Biggest happiness for the greatest number of people. (3) Precise measurement of disutility and utility. (4) Highest guaran

  • Q : Unexpected inventory growth of price

    These supply and demand curves within the sugar market specify that: (w) a price floor of P0 for sugar will cause a surplus. (x) a price ceiling of P2 will cause a shortage. (y) the market clears while quantity equals Q0

  • Q : Marginal revenue by price elastic

    When a monopolist's demand is price elastic, in that case marginal revenue is: (w) positive. (x) negative. (y) zero. (z) independent of price elasticity. I need a good answer on the topic of Economics

  • Q : Advantages of free market economy Give

    Give the best advantages of free market economy?

  • Q : Individual Welfare Recipients If an

    If an individual receives benefits from the government, associate to the benefits everyone else receives, which exceed the individual’s taxes like a proportion of total tax payments by all citizens, which individual can reasonably be viewed like

©TutorsGlobe All rights reserved 2022-2023.