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Analyzing output and price relationship in the given case

Give Me a Pane, Inc., distributes window glass to hardware and building supply chains located throughout the Northeast. Like several grain and commodity markets, the market for common single-pane glass is perfectly competitive. The company's technology defines a marginal cost per pound of single-pane glass given by the relation:

MC = $1.00 + $0.0001Q

where Q is pounds of single-pane glass.

A. Calculate the industry price necessary for the firm to supply 10,000, 20,000, and 30,000 pounds.
B. Calculate the quantity supplied by the firm at industry prices of $1.50, $2.50, and $3.50 per pound.

Solution Preview

A. Calculate the industry price necessary for the firm to supply 10,000, 20,000, and 30,000 pounds.
In perfectly competitive environment, a firm sets its output such that Marginal Cost(MC)=Market Price (P) to maximize its ...

Solution Summary

Solution describes the steps to calculate the industry price necessary for the firm to supply given output levels. It also calculate the quantity supplied by the firm at given price levels.

$2.19