--%>
Assignment Help - homework help

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 conditions operate by monopolies

    Hey friends I need your help for illustrates that this is NOT true by monopolies: (1) are generally more profitable in the long run when there are barriers to entry. (2) sometimes incur losses. (3) may try to increase demand by marketing. (4) shut down while faced by

    		•
  • Q : Monopolistic competitive firm in normal

    This monopolistically competitive firm in illustrated figure produces Q units as well as experiences: (1) economic profits equal to 0cbQ. (2) economic losses equal to cpab. (3) more than normal accounting profits. (4) marginal cost in excess of averag

    		•
  • Q : Law of Income Distribution by Pareto

    The theorist who asserted as, “When you redistributed the world’s income and wealth equally across the whole population, eighty percent of this would be back within the hands of the population’s top 20% in twenty years,” which

    		•
  • Q : Problem on decline in demand function

    In the month of January, Disney World in Florida cut its ticket prices into half and starts letting all kids beneath age five without charge. The economic forecaster might reasonably expect: (1) A decline in demand for the tickets to Disney Land in California. (2) A r

    		•
  • Q : Maximizing satisfaction In a vague

    In a vague world, people are supposed to maximize their satisfaction through: (1) Finding in advance the mixture of goods which maximizes utility and then purchasing this mixture. (2) The procedure of trial and error. (3) Taking marginal decisions till disutility stop

    		•
  • Q : Rule of thumb for office rent Is there

    Is there any rule of thumb for office rent or on lease per gross income? If yes, then explain?

    		•
  • Q : Labor Contracts-Shop Agreements From

    From the point of view of management, the favored union membership ranking (most favored to the least favored) would be: (i) Closed shop, union shop, agency shop and open shop. (ii) Open shop, agency shop, union shop and closed shop. (iii) Agency shop, open shop, clos

    		•
  • Q : Least possible cost for primary economy

    The least possible costs of alternative outcomes to the primary economic question of “what?” can be represented with the production possibilities curve through: (1) The slopes of movements all along the curve. (2) Shifting the curve up by

    		•
  • Q : Marginal revenue product problem

    Siberian Software vends custom programs to the multinational corporations. Its programs are coded in a remote region. In equilibrium, the Siberian’s programmers produce a marginal revenue product equivalent to around: (i) $21 per hour. (ii) $25 per hour. (iii) $

    		•
  • Q : Law of demand is the price in the "law

    is the price in the "law of demand" a relative price or an absolute price

    		•