a firm in a purely competitive industry is currently producing a 1000 unir per day at a total cost of $450. if the firm produced 800 units per day, it total cost will be $300, and it it produced 500 units per day, it total cost will be $275. Requirements: (1) what are the firm's ATC per unit at these three levels of production? (2) if every firm in this industry has the same cost structure, is the industry in long-run competitive equilibrium? (3) from what you know about these firms's cost structure, what is the highest possible price per unit that could be exist as the market price in the long run equilibrium? (4) if that price ends up being the market price and if the normal rate of profit is 10 percent , the how big will each firm's accounting profit per unit be?

  1. 👍
  2. 👎
  3. 👁
  1. For the first one, average cost per unit would be 450/1000, 300/800, and 275/500, just dividing the price by the units produced.

    Apologies that I can't help any further; I haven't taken Economics or Statistics yet and don't know what a lot of those terms mean (purely competitive??)

    Economics isn't Home Economics. This belongs under Math. (If it's automatically categorized, this message is to the Jiskha team, then.)

    1. 👍
    2. 👎

Respond to this Question

First Name

Your Response

Similar Questions

  1. Economics

    you are hired as the consultant to a monopolistically competitive firm. The firm reports the following information about its price, marginal cost, and average total cost. Can the firm possibly be maximizing profit? If the firm is

  2. economics

    A cloth producing firm in a perfectly competitive market has the following short-run total cost function: TC = 6000 + 400Q – 20Q2 + Q3. If the prevailing market price is birr 250 per unit of cloth, A. Should the firm produce at

  3. Economics

    . Consider total cost and total revenue given in the table below: QUANTITY 0 1 2 3 4 5 6 7 Total cost $8 $9 $10 $11 $13 $19 $27 $37 Total revenue 0 8 16 24 32 40 48 56 a. Calculate profit for each quantity. How much should the

  4. statistics

    You are a researcher for a professional research firm.Your firm has won a contract to do a study for an air travel industry publication

  1. Economics

    You’ve been hired by an unprofitable firm to determine whether it should shut down its unprofitable operation. The firm currently uses 70 workers to produce 300 units of output per day. The daily wage (per worker) is $100, and

  2. Mathematics in Economy

    A firm produces two different kinds A and B of a commodity. The daily cost of producing x units of A and y units of B is C(x,y) = 0.04x2 + 0.01xy + 0.01y2 +4x + 2y +500 Suppose that firm sells all its output at a price per unit of

  3. economics

    if the total cost function of a firm under perfectly competitive market is given by: TC= 3Q2 + Q + 90. then find the optimum level of output and the corresponding profit when the price of the products is birr 25? if you are the

  4. To: Economyst

    Hi there. You helped me with a couple of questions regarding Econ. I appreciate the help but my issue is I don't understand how you calculate the minimum average variable cost or the output that maximizes profit. I do understand

  1. managerial economics

    1. Some games of strategy are cooperative. One example is deciding which side of the road to drive on. It doesn’t matter which side it is as long as everyone chooses the same side. Otherwise, everyone may get hurt. Driver 2 Left

  2. Economics

    50. In both monopolistic competition and non-price-discriminating monopoly, isn't the marginal revenue curve lies below the demand curve? 51. A monopolistically competitive firm is producing an output level where marginal revenue

  3. 1. A firm produces a product in a competitive indu

    1. A firm produces a product in a competitive industry and has a short-run total cost function C(q) =4q2+16. a. Derive the supply function of the firm. b. Find the output that minimizes average total cost. c. At what range of

  4. Economics/Math

    Suppose there are four firms in a competitive market and that each firm has the following supply function. Supply functions for competitive firms Company Supply Function 1 Q1 = 16 + 4P 2 Q2 = -5 + 5P 3 Q3 = 32 + 8P 4 Q4 = - 60

You can view more similar questions or ask a new question.