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A firm sells its output in a PCM. The finm's short-run cost function by given SC = q' -0.29 + 4q + 10. a. Derive the short-run supply function of a typical firm in this industry. is 300

A firm sells its output in a PCM. The finm's short-run cost function by given SC = q' -0.29 + 4q + 10. a. Derive the short-run supply function of a typical firm in this industry. is 300

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter2: Fundamental Economic Concepts
Section: Chapter Questions
Problem 2E
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Hello! I just want to ask for help whether the answers in the given pictures are correct. If it's not, please help me correct and resolve it. Please refer to the given pictures below for the questions and answers. | After verifying the given answers shown in the subsequent picture, PLEASE ANSWER LETTER D. | D. At this equilibrium market price, calculate the level of output and profit that each firm produces in the short- run. With this information, comment on the potential entry/exit of firms in this industry in the long-run. | NOTE: Type only your answers. Please do not handwritten your answers.
2. A firm sells its output in a PCM. The firm's short-run cost function given SC = 9'-0.29 + 4g + 10. a. Derive the short-run supply function of a typical firm in this industry. is by b. Assuming that there are 100 identical firms in this industry, derive the short- run market supply function. c. If currently the market demand for these firm's product is Q = 200p", determine the short- run equilibrium market price. = 8,000 - %3D d. At this equilibrium market price, calculate the level of output and profit that each firm produces in the short- run. With this information, comment on the potential entry/exit of firms in this industry in the long-run.
Transcribed Image Text:2. A firm sells its output in a PCM. The firm's short-run cost function given SC = 9'-0.29 + 4g + 10. a. Derive the short-run supply function of a typical firm in this industry. is by b. Assuming that there are 100 identical firms in this industry, derive the short- run market supply function. c. If currently the market demand for these firm's product is Q = 200p", determine the short- run equilibrium market price. = 8,000 - %3D d. At this equilibrium market price, calculate the level of output and profit that each firm produces in the short- run. With this information, comment on the potential entry/exit of firms in this industry in the long-run.
Given; Short-run cost function' SC = g - 0. 2q7 + 4q+!0 a) Short-run supply function:- In short-run; Supply=MC Therefore; Supply equation; P = - 0. 4q + 4 100 Step 2 b) Market supply:- P = :- 0. 49 + 4 100 100P = q – 40q + 400 100P = q - 20 20 + 20 q+ 400 100P = q - 20q – 20g + 400 100P = (g – 20)2 10 F 10P + 20 = q - 20 9 = Market supply curve:- Qs = 100 × q = 100 x (10VP + 20) = 1000 VP + 2000 Step 3 c) At equilibrium; Demand=Supply Therefore; 8000 – 200P/2 = 1000 VP + 2000 1000 VP + 200 VP = 8000 – 2000 1200 VP = 6000 VP = 5 P = (5)² P = 25
Transcribed Image Text:Given; Short-run cost function' SC = g - 0. 2q7 + 4q+!0 a) Short-run supply function:- In short-run; Supply=MC Therefore; Supply equation; P = - 0. 4q + 4 100 Step 2 b) Market supply:- P = :- 0. 49 + 4 100 100P = q – 40q + 400 100P = q - 20 20 + 20 q+ 400 100P = q - 20q – 20g + 400 100P = (g – 20)2 10 F 10P + 20 = q - 20 9 = Market supply curve:- Qs = 100 × q = 100 x (10VP + 20) = 1000 VP + 2000 Step 3 c) At equilibrium; Demand=Supply Therefore; 8000 – 200P/2 = 1000 VP + 2000 1000 VP + 200 VP = 8000 – 2000 1200 VP = 6000 VP = 5 P = (5)² P = 25
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