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General Equilibrium

Economics help

Assume that a firm sells its product in a perfectly competitive market. The firm's fixed costs (including a "normal" return on the funds the entrepreneur has invested in the firm) are equal to $100 and its variable cost schedule is as follows: Output (Units) Variable Cost per Unit 50 $5.00 100 4.50 150 4.00 200

Marginal Cost and an Average Cost Schedule

Assume that a firm in a perfectly competitive industry has the following total cost schedule: Output (units) Total Cost ($) 10 $110 15 150 20 180 25 225 30 300 35 385 40 480 a. Calculate a marginal cost and an average cost schedule for the firm. b. If the prevailing market price is $17 pe

Move along the IS curve and/or which represent a shift curve

Explain which of these changes represent a move along the IS curve and/or which represent a shift of the IS curve and why. PLEASE DO NOT ANSWER UNLESS YOU THOROUGHLY UNDERSTAND IS CURVES (a) Stock market boom boosts consumption and investment (b) Government cuts taxes by $50 billion (c) Government passes $50 billion p

firms in a monopolistically competitive market

A "One might expect firms in a monopolistically competitive market to experience greater swings in the price of their products over the business cycle than those in an oligopoly market. However, fluctuations in profits do not necessarily follow the same pattern." Discuss this statement. B Market Structure Concepts: Ind

Practice problems in game theory

I'm doing practice problems for an exam in a game theory course and I want solutions by some one more knowledgeable, so that I could see if I did them right. I need all the problems in the file "supplement" done. I also need problems 5 and 9 from the file "problems 5 and 9", problem 3 from from file "problem 3" and problem 8 fr

Steady-state capital per worker

In this problem, assume that Mexico and the United States have the same aggregate production function, the same δ (value for depreciation of capital stock), and the same n . In Mexico, real GDP per worker in 2000 is about 40% what it is in the United States, but Mexico is not near its steady-state level of output. 1. If

Analysis of IS/LM curves

1 Carefully explain and show graphically how each of the following changes would effect the shape of the IS curve: a) The MPC becomes bigger. b) Investment becomes more sensitive to changes in the real interest rate. 2 In the State of the union address in January 2002, President Bush announced that he would ask Congress to

Calculating dead weight loss (lost efficiency.)

Here's what I think I know about the answer: to get the $ value of DWL you have to take the area of the aggregate surplus under perfect competition and substract the area of the aggregate surplus under monopoly (helps to make a little graph.) The funny thing is, my main problem is I don't know the geometry necessary to do that.

Demand, Production, Cost, Market Equilibrium, etc.

Please denote which letter best suits the answer to the question. 1. Microeconomics is the study of: A- the overall level of unemployment, output, and inflation in an economy B- how to increase our scarce resources C- how firms and individuals make economic choices and how those choices create mar

RTS, Market Demand, Price Elasticity

1. In what ways are firms' isoquant maps and individuals' indifference curve maps based on the same idea? What are the most important ways in which these concepts differ? 2. Bottles are produced according to the production function, q = 3K + L, where q = output per hour K = capital input per hour L = labor input per h

What is the subgame perfect equilibrium for Sony and Columbia pictures?

Consider the following game between Sony, a manufacturer of video cassette players, and Columbia Pictures, a movie studio. Each firm must decide whether to use the VHS or Beta format - Sony to make video players, Columbia to release its movies for rental or purchase. Columbia Pictures

Cournot problem

(See attached file for full problem description) --- Reconsider the attached problem (prior problem), except suppose American and United take each other's quantity as given rather than taking each other's price as given. That is, assume that American and United act as Cournot competitors rather than Bertrand competitors. The

Microeconomics questions

1. Suppose a monopolist faces the market demand function P = a - bQ. Its marginal cost is given by MC = c + eQ. Assume that a > c and 2b + e > O. a) Derive an expression for the monopolist's optimal quantity and price in terms of a, b, c, and e. b) Show that an increase in c (which corresponds to an upward parallel shift in

Microeconomics question

Please see the attached file. --- Suppose that in the domestic market for com¬puter chips the demand is pd = 110 - Qd, where Qd is the number of units of chips demanded domestically when the price is pd. The domestic supply is ps = 10 + QS, where QS is the number of units of chips supplied domestically when domestic supplie

Microeconomics help

(See attached file for full problem description) --- The market for commercial aircraft is dominated by two firms, Airbus (player A) and Boeing (player B). A crucial decision for each firm is that of introducing a new aircraft model. Let N (for "new") denote the strategy of introducing new models and let O (for "old") be t

Consumption Function

The question asked that suppose that the consumption function in a particular economy is given by the following table: Disposable Income Consumption Expenditure (Billions of Dollars) (Billions of Dollars)

INTERMEDIATE MICRO ECONOMICS PROBLEMS

(See attached file for full problem description) --- Question 1: Multi-Market Monopoly Consider a monopolist that produces output in a single plant at a constant marginal cost of $10 per unit. The monopolist sells in two different markets, rural and suburban. In the rural market, the price elasticity of demand for the

Cost-Demand Conditions: Profit Maximizing Quantity

Suppose your boss buys out every single pizza store in the US. Your cost-demand conditions are as follows: profit maximizing quantity - 60 pizzas; price - 20$ per piece; per unit cost (total) - $12 per piece, per unit cost (variable) - $8. a. Draw the graph, label all the curves and put all the numbers on the graph. Identif

Labor Market Equilibrium: Wages

Consider the attached graph. 1. At labor market equilibrium, _______ workers are hired at a wage rate of $_______ per hour, while total wages equal $_______. 2. At labor market equilibrium, how much is the payment to U.S. capital owners? 3. If Mexican migration to the United States results in the labor force increasin

Consumption, tradable capital good, wages, interest rates, taxes

Please see the attachment. I require very specific explanations for each part. If necessary, assumptions may be made but please make these explicit and make sure they are reasonable so that I can follow what you did. Also make the solutions as technical as possible. (See attached file for full problem description)

Determine the Market Structure

1. Determine the Market Structure Exhibit 3 depicts indicates the demand and cost conditions facing a firm. a. Label all the curves and axis on the graph. Is this firm a price-taker or a price-searcher? Explain exactly how you can tell the difference. b. Illustrate the firm's profit maximizing price and output in the

Monopolistic Competition

1. Monopolistic Competition Exhibit 2 shows the short-run demand and cost conditions for a firm under Monopolistic Competition. Replicate the graph. Label the curves and axis. a. What level of output will maximize the firm's profit? b. What price will the firm charge? c. How much revenue will the firms receive in th

Pricing with market power

1. BMW has MC=$20,000 and FC=$10billion. Demand for markets in Europe(e) and US(u) are Qe=4,000,000-100Pe and Qu=1,000,000-20Pu. Prices and Costs are in thousands. BMW can restrict US sales to authorized BMW dealers only. a. What should be the quantity and price in each market. b. What should be the total profit. c. If the

Competition from Gakk Pharmaceuticals would affect Aveta's profits from Taziclor.

Describe how competition from Gakk Pharmaceuticals would affect Aveta's profits from Taziclor. Include the following in your report: ? In qualitative terms, discuss how Gakk's potential entry into the market would affect the market demand curve for cures for the common cold and Aveta's (firm-specific) demand curve for Taziclo

Perfect Competition: Long Run

(See attached file for full problem description) --- Exhibit 2 depicts the market conditions experienced by representative firms in three different price-taker markets. Replicate the diagrams below and answer the following questions. a. Which one of the conditions is true for a representative firm in the apple industry:

Microeconomics problem

Producer Behavior and Costs 1. Town workers occasionally use their own automobiles on official business. The currentreimbursement rate is $.25 per mile. The employees' union complains to the town manager thatnumerous studies show that the cost of operating an automobile is really $.50 per mile, so that the current rate is t

Distribution of costs and benefits

(See attached file for full problem description with diagram) --- 15. (Distribution of Costs and Benefits) Suppose that the government decides to guarantee an above-market price for a good by buying up any surplus at that above-market price. Using a conventional supply-demand diagram, illustrate the following gains and a

Competitive firms and the cost function

In the market for widgets the market demand curve is given by: P=50-0.05Q The market is competitive and each firm has total costs given by: C(q) = 640 + (0.1)q^2 (a) Find the equilibrium i. output of each firm ii. price iii. market quantity iv. Number of firms (throughout this question ignore the indivisibility

Short run equilibrium & units of output

If the total cost schedule for a perfectly competitive firm is and if market price is $60, how many units of putput will the firm produce? a. 0 units of output because the firm shuts down b. 2 units of output c. 3 units of output d. 4 units of output e. none of the above Output Total Cost 0 $10 1

Monoplies

Please give me your answers to these study questions. If you are not sure, can you give me a web site to go to? 1-1. In a monopoly market, a. one firm is the only supplier of a product for which there are no close substitutes. b. entry into the market is blocked. c. the firm can influence market pri