1. ) The original price-quantity pairing is $10 and 52 units. after a decrease i
ID: 1122841 • Letter: 1
Question
1. ) The original price-quantity pairing is $10 and 52 units. after a decrease in the number of sellers the new price-quanitity pairing is $12 and 42 units. given this data one should be able to conclude that the price elasticity of deamnd is____?
Options Elastic, inelastic, unit elastic or not enough info given
2.) For normally shaped demand and supply curves, if the number of buyer increases then ceteris paribus both the ??
Options :demand and eqilibrium price will increase; demand and the price will decrease; quanitity supplied and the price will decrease; supply and the price will increase
3)P=MC rule applies :??
options : to firms in all types of industries, only when the firm is a price taker, only to monoploies, only to purely competitive firms
4.)the cost function for a firm is given by TC = 4,000 + 0.1Q+ .01Q*Q. marginal costs are given by MC = 0.1 + 0.02Q. the firms fixed cost (FC) is ??
5) the cost function for a firm is given by TC = 4,000 + 0.1Q+ .01Q^2. marginal costs are given by MC = 0.1 + 0.02Q. the firms total variable cost when q=100 is???
6) the cost function for a firm is given by TC = 4,000 + 0.1Q+ .01Q^2. marginal costs are given by MC = 0.1 + 0.02Q. the firms average variable cost (AVC) when output is 200 is??
7) the cost function for a firm is given by TC = 4,000 + 0.1Q+ .01Q2. marginal costs are given by MC = 0.1 + 0.02Q. What is the marginal cost of produce the 100th unit of output???
Clear short fast answers please, deadline soon. Thanks!
Explanation / Answer
1.
Correct Answer:
Inelastic
Working note:
Price elasticity of demand = % change in price / % change in quantity demanded
Price elasticity of demand = ((42-52)/52)/((12-10)/10) = -.96
Since the elasticity is less than 1 (absolute value), then the elasticity is relatively inelastic.
2.
Correct Answer:
Demand and equilibrium price will increase
Due to increase in number of buyers, the demand curve will shift to the right. As a result, the demand will increase at a higher price at a new equilibrium.
3.
Correct Answer:
Only to purely competitive firms
In perfect competition only, the P=MC rule is applied for profit maximizing output.
4.
Fixed cost = fixed part of the total cost = $4000
5.
Total variable cost = .1Q + .1Q^2 (Derived from the total cost function)
At Q = 100
Total variable cost = .1*100 + .1*100^2 = $1010
Please repost the other unanswered questions for their proper answers!
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