Microeconomics Answers

Is a firm technologically efficient if it uses the latest technology? Why?

 How does a single-price monopoly determine the price it will charge its customers? Why can a monopoly make a positive economic profit even in the long run?

 In a perfectly competitive market where there is virtually no product differentiation, what are the priorities or focus of a firm? How could a firm increase profits?

Which industries are highly competitive, give local examples? What are the three types of firm and in which sectors is each type most prominent?

a. Name a product that has a price that adjusted very frequently in the last year. Explain why.                 

b. What is the difference between monopolistic competition and oligopoly? Explain with local   examples. 

  A customer care company is considering replacing human telephone operators with computers.

Create your own example, schedule and graph:

a The average cost curves and the marginal cost curve when the firm uses human operators.

b The average cost curves and the marginal cost curve when the firm uses computers.

‘In perfect competition, marginal revenue equals price’ – explain with examples of product schedule and curves .

A firm has the following demand function 𝑷 = 𝟔𝟎 − 𝟎. 𝟓𝑸 and its total cost are defined by 𝑻𝑪 = 𝟏𝟑 + 𝑸.

a. Find the maximum revenue.

b. Find the production to optimize the profit.

c. Verify if the marginal revenue and marginal cost are the same at the profit-maximizing production level. 

A firm has the following average cost 𝑨𝑪 = 𝟐𝟎𝟎 𝑸 + 𝟐𝑸 − 𝟑𝟔.

a. Find the stationary point and determine if it is a maximum or a minimum.

b. Find the marginal cost function.

A Firm has the following production function 𝑸 = 𝟐𝟎𝑳 − 𝟎. 𝟒𝑳 𝟐.

a.Using differential calculus find the unit of labor that maximizes the production.

b. Estimate function of Marginal product of labor.

c. Obtain the Average product of labor.

d. Find the point at which the marginal product of labor is equal to the average cost.