Microeconomics Answers

Briefly explain by means of example the difference between a maximum price and a minimum price

Assume there's an increase in the price of the wood used in the production of kitchen tables. Illustrate and explain how this would impact the equilibrium price and quantity of kitchen tables. 

Q_x= 1.0- 2.0P_x + 1.5I + 0.8P_y- 3.0P_m+ 1.0A

Calculate sales

The market for lemon has 10 potential consumers, each having an individual demand curve (5%)

P = 101 - 10Qi, where P is price in dollars per cup and Qi is the number of cups demanded per week by the ith consumer.

a. Find the market demand curve using algebra

b. What is the quantity demanded by each consumer and in the market as a whole when lemon is priced at P = $1/cup?

Describe and give some explanations about 2 factors that would cause most companies' labor demand to move, as well as how this would influence equilibrium wages and the value of labor's marginal product.

Illustrate consumer and producer surpluses with demand and supply diagrams and explain how to maximize the total surplus (consumer surplus + producer surplus) at the equilibrium level.

The average total cost (ATC) curve of a business varies/curve with the time frame. Give some explainations and reasons for the difference between short and long-term ATC curves and how firms can be identified as economies of scale, constant returns of scale and diseconomies of scale.

Give five (5) characteristics of a monopolistic market.

In Thailand, a firm named SunFly is planning to monopolize its streaming services. The firm has made a ฿3 million investment in their streaming offerings. In addition, the firm has faced a marginal cost of ฿10 for each streaming service it offers. The table below displays SunFly's monthly streaming service pricing as well as the quantity demanded for each pricing. 

Price (฿):

1. ฿ 130
2. ฿ 120
3. ฿ 110
4. ฿ 100
5. ฿ 90
6. ฿ 80
7. ฿ 70
8. ฿ 60
9. ฿ 50

Quantity demanded:

1. 10,000
2. 20,000
3. 30,000
4. 40,000
5. 50,000
6. 60,000
7. 70,000
8. 80,000
9. 90,000

a.) Calculate total revenue, marginal revenue, total cost, and profit using the information given. What amount should a monopolistic business charge in order to maximize profits?

b.) Illustrate (draw) a graph for the marginal-revenue, marginal-cost, and demand curves based on your solution in (a). The marginal revenue and marginal-cost curves intersect at what price and quantity? Furthemore, give some explainations of your graph.