Consider the problem of a competitive firm which has fixed costs of $1000, semi-fixed-costs of $1000, and variable costs given by q^2.

QUESTION: What is the maximum market price at which the firm decides to supply zero?

... and not a single thought of your own?

You're more likely to get a response from a tutor if you indicate what you think, what you have done, etc.

I do not know of anyone here who can help off hand. I think Jenny had best ask at the University of Chicago :)

To find the maximum market price at which the firm decides to supply zero, we need to determine the price level at which the firm's total revenue will be equal to or less than its total costs. In this case, we need to consider the firm's fixed costs, semi-fixed costs, and variable costs.

1. Fixed Costs: These costs do not change with the level of production or the market price. In this case, the fixed costs are $1000.

2. Semi-Fixed Costs: These costs are partially fixed and partially variable. In this case, the semi-fixed costs are also $1000.

3. Variable Costs: These costs depend on the level of production. In this case, the variable costs are given by q^2, where q represents the quantity produced.

Let's denote the market price as P and the quantity produced as q. The firm's total costs can be calculated as:

Total Costs = Fixed Costs + Semi-Fixed Costs + Variable Costs
Total Costs = $1000 + $1000 + q^2

The firm's total revenue can be calculated as:

Total Revenue = Price x Quantity
Total Revenue = P x q

To find the maximum market price at which the firm decides to supply zero, we need to set the firm's total revenue equal to its total costs and solve for P:

Total Revenue = Total Costs
P x q = $1000 + $1000 + q^2
Pq = $2000 + q^2

Now, since the firm decides to supply zero at this maximum price, we can set q to zero:

0 = $2000 + 0^2
0 = $2000

Since the equation is false, it means the firm will never supply zero. There is no maximum market price at which the firm decides to supply zero. The firm will always supply some quantity as long as the price is positive.