Microeconomics Answers

1. Assume the following market demand curve: Q = 13 – 0.5P. Assume marginal cost is constant at $2.

Also assume there is a dominant firm with 6 identical competitive fringe suppliers. .

The following information will be useful for this problem:

           Residual Demand = Market Demand – Fringe Supply

           Total Fringe Supply: 3 + 0.5P

a. Calculate the equilibrium price and quantity for the dominant firm and the average fringe firm.

b. Calculate the value consumer surplus (based on total output--the dominant firm + fringe).

c. Calculate the deadweight loss (based on total output--the dominant firm + fringe).

d. Calculate the profit for the dominant firm.

e. Illustrate the Demand, market price, market quantity, consumer surplus and deadweight loss(based on total output--the dominant firm + fringe) .

spores of farmer find that we cancel any amount of city produce at current market price but can’t sell any amount if he tries to charge a price that higher. Draw an

Appropriate demand or supply crap to get his experience

appropriate demand or supply graph to get his experience

Suppose a firm produces according to the production function Q = 2L0.6K0.2, and faces wage rate

₵10, a rental cost of capital ₵5, and sells output at a price of ₵20.

a. Obtain and expression for the factor demand functions.

b. Compute the profit-maximizing factor demands for capital and labour.

XYZ Co. operates in a competitive market. Its marginal product of labor is 1/L, and it takes the

wage and price as given. Derive the firm's short-run demand for labor as a function of w and p.

How much labor will the firm hire if W=₵20 and P=₵100?

In the short run, a competitive firm has a production function,

Q = f(L) = 2.6667L0.75. The output price is $4 per unit and the wage is $5 per hour. Find the shortrun labor demand curve of the firm.

A firm has a Cobb-Douglas production function given as

q=ALαKβ

a. Solve for the factor demand functions

b. If the firms’ competitive output price is p find the wage rate

c. What is the share of the firm’s revenue paid to labour and capital?

d. If α=0.6, β=0.2 and A=1 find the LR labour and capital demand curve equations

Find the derivative of y= 4tan5α

forest fires have devastated the orchards in Okangans what happens to the graph for apple