Marginal cost and marginal benefit (dollar perpound) 5 N MC M8 100 200 300 400 500 600 Quantity (pounds of coffee perday) The above figure shows the marginal benefit and marginal cost curves of coffee in the nation of Kaffenia. Which of the following would result in the quantity of coffee in Kaffenia differing from the efficient quantity? The existence of price control in the market. The existence of many producers and sellers of coffee. The existence of a single producer and seller of coffee. Both "The existence of a single producer and seller of coffee." and "The existence of price control in the market." are correct.
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- (Figure: Avocado Market 2) You're an economist for the U.S. Department of Agriculture, analyzing how incorrect assessments of demand conditions lead avocado producers to overproduce avocados, as illustrated in the accompanying diagram. Price ($ per pound) Actual quantity Marginal cost 5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 Marginal benefit 0 10 20 30 40 50 60 70 80 90 100 Quantity of avocados (thousands of pounds) The deadweight loss from the excess of marginal cost over marginal benefit is: O $0. O $5,000. O $20,000. 0 $800,000.What is the equilibrium price of a small soda? * Market Demand Schedule Price of a Number Small demanded Soda per day $0.25 $0.50 $0.75 $1.00 890 500 480 470 $1.25 $1.50 $1.75 410 350 280 $2.00 $2.25 240 200 $2.50 $2.75 150 100 O $1.00 $1.25 $1.50 $1.75 not enough information available to determine13. Firms in Competitive Markets The market for fertilizer is perfectly competitive. Firms in the market are producing output but are currently making economic losses. Which of the following statements is true about the price of fertilizer? Check all that apply. The price of fertilizer must be greater than average total cost. The price of fertilizer must be greater than marginal cost. The price of fertilizer must be greater than average variable cost. The following graphs show the cost curves faced by a typical firm, the demand for fertilizer, and possible price and supply curves. Price and Costs MC Firm ATC AVC Quantity Price No U 1 Demand If firms in the market are producing output but are currently making economic losses, market and indicates the corresponding supply curve Market Quantity 52 S illustrates the present situation for the typical firm in the
- use diagramsa. What is the effect on the equilibrium price and quantity traded in market of theintroduction of a new technology that reduces costs of production for all firms?b. What is the effect on the equilibrium price and quantity traded in a market of a changein tastes that reduces the demand for the product?c. What is the effect on the equilibrium price and quantity traded in a market of theimposition of a tax per unit sold on suppliers?d. What is the effect on the equilibrium price and quantity traded in a market of thepayment of a subsidy per unit sold paid to suppliers?In a market which demand and supply curves are shown below: Price ($/hour) 36- 32 28- 24 20- 16 12- 8- 4- 0 Demand Supply 1000 2000 3000 4000 5000 6000 7000 Quantity (units/day) a) Calculate the consumer surplus for the market. (If necessary round your answer to the nearest whole number.) Consumer Surplus = $0 b) Calculate the producer surplus for the market. (If necessary round your answer to the nearest whole number.) Producer Surplus = $0CON101 section(2,3 &5)Dr. Abdulhadi Ibrahim / Bonus Quiz (Section 5) 8am Market failure can be caused by of Select one: tion O a. government intervention and price controls O b. externalities and market power O c. high prices and foreign competition O d. low consumer demand
- Illustrate and explain the effect of the increased use of plant-based milk on the overall milk market.A producer of ink bottles in the shape of oil tankers comes in one morning to discover that the ink bottle on his desk has cracked overnight. The ink spill has obliterated several entries in his books. Please help the producer reconstruct the following table. Quantity 0 10 20 30 40 50 AFC XXX TVC ATC XXX 420 2 20 14 MC TC XXX 11 390Price $3 2 10,000 20,000 30,000 S D Quantity Refer to Figure 4-4. The figure above represents the market for iced tea. Assume that this is a competitive market. At an output of 10,000 units the marginal benefit of iced tea is greater than the marginal cost; therefore, output is inefficiently high. the marginal benefit of iced tea is greater than the marginal cost; therefore, output is inefficiently low. the marginal cost of iced tea is greater than the marginal benefit; therefore, output is inefficiently low. producers should lower the price to $1 in order to sell the quantity demanded of 10,000.
- Suppose that you produce and sell children's tables in a local market. Past experience enables you to estimate your demand and marginal cost schedules. This information is presented in the accompanying table. Complete the following table by computing the total cost of producing each quantity. Then, compute the total revenue earned at each price level and the marginal revenue earned at each price level. Price ($ per table) 60 55 50 45 40 35 Quantity Demanded (Tables per Week) 2014 1 2 3 4 5 O Increase the price O Leave the price unchanged O Decrease the price 6 Fixed Cost ($) 40 40 40 40 40 40 Total Cost Marginal Cost ($) ($) $ $ $ $ $ 90 Given your demand and cost estimates, you should charge a price of be tables, and you will earn a weekly profit of $ 20 24 29 35 45 Total Revenue ($) Assuming you are currently charging $55 per table set, what should you do if you want to increase profits? $ $ $ $ $ $ Marginal Revenue ($) $ $ $ $ $ if you want to maximize your weekly profit. At this…Figure 12-6 Price (dollars per pound) Market 3 price 2 0 10 20 30 MC ATC D=MR 40 Quantity (thousands of pounds) Figure 12-6 shows the demand, marginal cost (MC) and average total cost (ATC) curves for Jason's House of Apples. Refer to Figure 12-6. Jason is currently producing 20 thousand pounds of apples. To maximize his profit Jason should keep production at 20 thousand pounds. O increase production to the output rate indicated by point e. increase production to the output rate indicated by point d. O decrease production to the output rate indicated by point a.Price and cost (dollars per student) $150 120 88 76 72 ATC 40 - MC MR 24,000 30,000 36,000 Quantity of students enroiled 15,000 Your college decides to offer a psychology course as a MOOC that can be taken by students anywhere in the world, whether they are actually enrolled in your college or not. The demand and cost situation for the MOOC is shown in the figure. The faculty member who designed the course argues: "I think the course should be priced so that the maximum number of students enroll." Which price should this faculty member favor? O A. $0 В. $40 C. $88 D. $150