A firm sells its product in a perfectly competitive market where other firms charge a price of...
Question:
A firm sells its product in a perfectly competitive market where other firms charge a price of $100 per unit. The firm's total costs are C(Q) = 60 + 12Q + 2Q^2.
a. How much output should the firm produce in the short run?
b. What price should the firm charge in the short run?
c. What are the firm's short-run profits?
Perfect Competition:
Perfect competition is a market situation where the price of the good or service is beyond the control of the producers. Firms revenue maximize at the equilibrium quantity where price is equal to marginal cost.
Answer and Explanation: 1
Become a Study.com member to unlock this answer! Create your account
View this answera. The marginal cost is equal to the derivative of the total cost. In perfect competition the equilibrium is determined at the point where price is...
See full answer below.
Ask a question
Our experts can answer your tough homework and study questions.
Ask a question Ask a questionSearch Answers
Learn more about this topic:
Get access to this video and our entire Q&A library
Perfect Competition: Definition, Characteristics & Examples
from
Chapter 3 / Lesson 62
276K
Learn the definition, characteristics, and benefits of perfect competition. Review real-life examples of perfect competition between different companies.
Related to this Question
- A firm sells its product in a perfectly competitive market where other firms charge a price of $120 per unit. The firm's total costs are C(Q) = 50 + 12Q + 2Q^2. (A) How much output should the firm pr
- A firm sells its product in a perfectly competitive market where other firms charge a price of $120 per unit. The firm's total costs are C(Q) = 50 + 12Q + 2Q2. a. How much output should the firm prod
- A firm sells its product in a perfectly competitive market where other firms charge a price of $110 per unit. The firm's total costs are C(Q) = 60 + 14Q + 2Q^{2}. (a) How much output should the firm
- A firm sells its product in a perfectly competitive market where other firms charge a price of $100 per unit. The firm's total costs are; C(Q) = 60 + 12Q + 2Q^2. a. How much output should the firm produce in the short run? b. What price should the firm
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm's total costs are C(Q) = 40 + 8Q + 2Q^2. A) How much output should the firm produce in the short run? B) What price should the firm charg
- A firm sells its product in a perfectly competitive market where other firms charge a price of $110 per unit. The firm's total costs are C(Q) = 50 + 10Q + 2Q2. a. How much output should the firm prod
- A firm sells its product in a perfectly competitive market where other firms charge a price of $90 per unit. The firm's total costs are C(Q) = 60 + 14Q + 2Q^2. A. How much output should the firm produce in the short run? B. What price should the firm char
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm s total costs are C(Q) = 40 + 8Q + 2Q^2. What price should the firm charge in the short-run?
- A firm sells its product in a perfectly competitive market where other firms charge a price of $90 per unit. The firm's total costs are C(Q)=40+10Q+2Q^2. A. How much output should the firm produce in
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm s total costs are C(Q) = 40 + 8Q + 2Q^2. How much output should the firm produce in the short run?
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm s total costs are C(Q) = 40 + 8Q + 2Q^2. What are the firm s short-run profits?
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm's total costs are C(Q)=70-8Q-2Q^2. How much output should the firm produce in th
- A firm sells its product in a perfectly competitive market where other firms charge a price of $70 per unit. The firm's total costs are C(Q)=50+10Q+2Q^2. a. How much output should the firm produce in
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm's total costs are C(Q)=50+12Q+2Q^2. a. How much output should the firm produce in
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm s total costs are C(Q) = 40 + 8Q + 2Q^2. What adjustments should be anticipated in the long run?
- A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm's total cost are C(Q)=40+8Q+2Q^2. What adjustments should be anticipated in the long run?
- Suppose the cost function for your firm is: C = 10 +2Q + 5Q^2. If the firm sells output in a perfectly competitive market and other firms in the industry sell output at a price of $35. What level of output should the firm produce to maximize profits or mi
- A perfectly competitive firm produces 50 units of a product and sells it at the market price of $23 per product. The firm's average total cost is $20. What is the firm's total revenue? (a) $23 (b) $150 (c) $1,000 (d) $1,150 (e) $2,500
- A perfectly competitive firm sells its product for $170/unit and has a total cost of production given by: C(Q) = 50Q + 2.5Q^2 + 400. A) What are this firm's fixed costs? Explain. B) Determine this firm's profit maximizing level of output. C) Determine thi
- A competitive firm currently produces and sells 7,500 units of output at a price of $2.50 per unit. The firm's average fixed cost is $0.75 and its average total cost is $2.80. In the short run, should the firm continue to operate?
- Suppose the cost function for your firm is: C = 10 +2Q + 5Q^2. If the firm sells output in a perfectly competitive market and other firms in the industry sell output at a price of $35. What will be the level of profits or losses in the firm makes optimal
- If a firm in a perfectly competitive market is currently producing the output where the price is equal to marginal cost and average total cost, what could we assume about the firm? A) The firm is suff
- If the firm represented by the above set of cost curves is able to sell its product in a perfectly competitive market for a price of $5.50, and it produces the profit-maximizing level of output, calculate the firm's total cost.
- A perfectly competitive firm a. sets a price above its marginal cost to maximize profits. b. sets its price to undercut other firms selling similar products. c. sets its price as given by the market equilibrium. d. sets its price equal to the average vari
- You are the manager of a firm that sells its product in a competitive market at a price of $10. Your firm's cost function is C = 10 + 15Q + 0.5Q2. What are the maximum total profits that you will make
- A firm that operates in a competitive market has a total cost of production given by TC(Q) = 3,000 + 5Q + 18Q^2 and marginal cost given by MC(Q) = 5 + 36Q. The market price for the product it sells is P = $239. Then the profit maximizing quantity is: (a)
- Consider two firms, Firm A and Firm B, who compete as duopolists. Each firm produces a homogeneous product. The total inverse demand curve for the industry is P = 250 ? (QA + QB). Firm A has a total cost curve C_A(Q_A)=100+Q^2_A. Firm B has a total cost
- You are the manager of a firm that sells its product in a competitive market at a price of $40. Your firm's cost function is C = 60 + 4Q2. The profit-maximizing output for your firm is: a. 5. b. 15. c
- You are the manager of a firm that sells its product in a competitive market at a price of $60. Your firm's cost function is C = 50 + 3Q^2. The profit-maximizing output for your firm is: Select one:
- You are the manager of a firm that sells its product in a competitive market at a price of $60. Your firm's cost function is C = 33 + 3Q^2. The profit-maximizing output for your firm is: A. 6. B. 10. C. 3. D. 5.
- You are the manager of a firm that sells its product in a perfectly competitive market at a price of $60. Your firm's total cost function is C = 33 + 3Q^2 and marginal cost function is MC = 6Q. The profit-maximizing output for your firm is: (a) 3. (b) 5.
- A perfectly competitive firm is selling a product at the market price of $11. It produces and sells the profit-maximizing quantity of 50 units, and at this level of output, its average total cost is
- Two firms compete as Stackelberg oligopolists. The market demand is given by P=90-Q, where Q=q_{1}+q_{2}. Firm 1's total costs are given by C_{1}(q_{1})=10+q^{2}_{1} and Firm 2's costs are given by C_
- A firm operates in a perfectly competitive industry. At the current level of output, the marginal cost is $26 and the average cost is $23. If the firm can sell its product for $25: a. The firm should produce more units, b. The firm is maximizing its profi
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function P and that the other firms have the same costs. Firm 2 ma
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function P and that the other firms have the same costs. Firm 4 ma
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function (P), and that the other firms have the same costs. Firm 1
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function (P), and that the other firms have the same costs. Firm 2
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function (P), and that the other firms have the same costs. Firm 3
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function (P), and that the other firms have the same costs. Firm 4
- Assume that all firms in a competitive market have a total cost curve given by TC = 162 + 2q^2. If the market price is $32, which statement is true? A. The firm produces 16 units and some firms exit the industry. B. The firm produces 8 units and some firm
- A firm sells its output in a perfectly competitive milk market at a Price = $28.00. The firm's total costs are given as TC = 1500 +4Q + 2Q^2 a) Find the firm's marginal cost? Show your steps b) Wha
- A competitive firm in long-run equiblirium will not: a. produce where average total costs are falling. b. price discriminate among units of output. c. price discriminate among buyers. d. change price to increase profit, or be able to lower costs by produc
- You are the manager of a firm that sells its product in a competitive market at a price of $12.6. Your firm's cost function is C = 0.72Q2 + 0.58Q + 9. The maximum profit your firm can earn is: ? Round
- A firm has a total cost of TC = 0.5q^2 + 15q + 300, where q is its output, and faces a demand for its product given by q= 100 - 3p, where p is the price it charges. A. Find the profit-maximizing price and output for this firm. B. Is it making a profit? If
- The cost function for a firm is given by TC 500 Q2. The firm sells output in a perfectly competitive market and other firms in the industry sell at a price of $100. a What price should the manager of
- A perfectly competitive firm is selling 300 units of output at $4 each. At this output level, total fixed cost is $100 and total variable cost is $500. The firm: A. is earning a profit, but not necess
- A purely competitive firm sells trinkets for $10 each. Fixed costs are $2, and each unit produced adds $2 of variable costs. a. Calculate the total and marginal costs. b. What the is profit-maximizing level of output? c. Suppose instead that the same firm
- A firm has hired you as a consultant. This firm is perfectly competitive and has no control over price. This firm is selling 10,000 units at a price of $4. Total costs are $30,000. Total variable costs are $25,000. They can produce another unit at a cost
- In a purely competitive market, a firm finds that at its MR = MC output level the Total Variable Cost (TVC) equals $550, Total Fixed Cost (TFC) equals $250, and Total Revenue equals $700. The firm should: a) produce because it will realize an economic pro
- In a perfectly competitive industry the market price is $12. A firm is currently producing 50 units of output; average total cost is $10, and average variable cost is $7. In order to maximize profit, the firm should: a. produce more because the firm is ea
- A firm that has total fixed costs of $20,000 sells its output for $150 per unit and has an average variable cost of $200. If the firm's cost and revenue curves are linear, how much output must the firm produce to break even? a. 500 b. 400 c. 300 d. Th
- If a firm produces 10 units, total cost = $100. When the firm increases its output to 15 units, total cost = $150. What is the firm's average variable cost?
- When a firm sells one or more products for less than their marginal cost, in the hope that customers will buy more of other products the firm sells, the firm is engaging in: a) loss-leading. b) multi-period pricing. c) crowding out. d) price discrimin
- Two firms, firm A and firm B, are located next to each other. Firm A produces good A and firm B produces good B. The price of good A is 2 and the price of good B is 3. The cost function for firm A is c_A(A) = \frac{A^2}{100} and the cost function of firm
- You are a general manager to a firm in a perfectly competitive market that sells Product X at a market price of $30 each. The firm's cost scheduled is as follows: Quantity Price TR TC Profit MR MC FC VC ATC AVC 0 10 1 25 2 45 3
- You are the manager of a firm that sells its product in a competitive market for $50. Your firm's cost function is C =40 + \text{5Q}^{2}. Your firm's maximum profits are? A. 125 B. 250 C. 100 D. 85
- A competitive firm's total cost is TC(Q) = 40 + 2Q + 0.4Q^2. Verify that the firm's marginal cost is MC(Q) = 2 + 0.8Q. The market price is $18/unit. What is the firm's maximum profit?
- In a perfectly competitive market suppose that a competitive firm's marginal cost of producing output q is given by MC(q) = 3 + 2 q. Assume that the market price of the product is $9. A. What level of output will the firm produce? B. What is the firm's pr
- Suppose that a competitive firm's marginal cost of producing output q(MC) is given by: MC(q)=6+2q. Assume that market price (P) of the firm's product is $18. a. What level of output (q) will the firm produce? b. What is the firm's producer surplus? Suppos
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function (P), and that the other firms have the same costs. Price
- If the firm represented by the above set of cost curves is able to sell its product in a perfectly competitive market for a price of $5.50, and it produces the profit-maximizing level of output, calculate the firm's profit.
- Let the market price for an oligopoly of 4 firms be where Q the sum of all firms output All of the firms have a cost per unit produced of $10, and no fixed costs. Each firm knows the price function (P), and that the other firms have the same costs. Q = Bl
- The total cost function of a firm operating in a perfectly competitive market is C(Q) = 10 + 2Q + .5Q2. The firm's product is set by the market at $35. a. What level of output should this firm produc
- All firms in a competitive industry have long-run total cost curves given by LTC = Q3 - 10Q2 + 36Q, where Q is the firm's level of output. a. What will be the industry's long-run equilibrium price? b. What will be the long-run equilibrium output level of
- A competitive firm currently produces and sells 500 units of output. Its total revenue is $3,500; the marginal cost of producing the 500th unit of output is $5.75; and the average total cost of produc
- You are the manager of a firm that sells its product in a competitive market at a price of $1969. Your firm's cost function is C = 252 + 1Q2. Calculate your firm's maximizing profit Round all calculat
- If firms sell differentiated product and compete in prices, an increase in the market size leads to: A) Increase in all prices. B) Increase of the price for the firm with lowest costs. C) Increase of the price for the firm with highest costs. D) None of t
- There are two firms producing identical goods. Each firm has the cost structure TC(q)=q^2+30. These are the only two firms in the market where the market demand for good P=-2Q+50. a. Find the profit of each firm if each firm produces 5 units od output. S
- If a perfectly competitive firm and a single price monopolist face the same demand and cost curves then the competitive firm will produce a a. greater output and charge a lower price than the monopol
- A firm operates in a perfectly competitive industry. Suppose it has a short run total cost function given by TC = 90000 + 0.01q^2. If the market price is 62, what is the firm's profit maximizing quantity?
- A monopolistic competitor is currently producing 2,000 units of output; price is $100, marginal revenue is $80, average total cost is $130, marginal cost is $60, and average variable cost is $60. The firm should: a) Raise price because the firm is losing
- Suppose that the marginal cost of producing output, q, in the short-run for a competitive firm is MC = 10 + 8q. The market price of the firm's product is $25. a. What level of output will the firm pr
- Firms producing an identical product in a perfectly competitive market are producing at a quantity that maximizes profit. The current market price is $4.50 per unit, and the firms are producing at a long-run average cost of $3.50 per unit. Firms in this m
- If the firm represented by the above set of cost curves is able to sell its product in a perfectly competitive market for a price of $5.50, and it produces the profit-maximizing level of output, calculate the firm's total revenue.
- You are the manager of a firm that sells its product in a competitive market at a price of $150. Your firm's cost function is C=125+5Q2. Your firm's maximum short-run profits are either 0, 500, 750, o
- Total Costs for a firm are given by: TC=1Q^2+9Q. Marginal costs for that same firm are given by: MC=2 \times 1Q+9. If this firm is operating in a perfectly competitive environments and is a price-taker, what would their total profits be it the market pric
- Suppose that a perfectly competitive firm's total cost of producing output q is TC(q) = 10 + 10q - q2 + 0.25q3 and market price p = $10. a. Find the short-run supply curve of a firm in this industry. b. How much will the firm produce at p = $10?
- The price charged by a Perfectly Competitive firm is determine by _____. a. each individual firm. b. a group of firm together as a cartel. c. market demand and market supply. d. the firm total costs alone.
- Consider two firms (Firm 1 and Firm 2) that produce differentiated products. Each firm incurs the same costs of production, where marginal costs are MC_1 = MC_2 = 0 (i.e., zero) and total fixed costs are TFC_1 = TFC_2 = 10. In this situation, the firms co
- All firms in a competitive industry have long-run total cost curves given by LTC(Q) = Q3 ? 10Q2 + 36Q where Q is the firm's level of output. What will be the industry's long-run equilibrium price? Wha
- If a perfectly competitive firm and a single-price monopolist face the same demand and cost curves, then the competitive firm will produce a a. greater output and charge a lower price than the monopo
- Assume that a firm in a perfectly competitive market can sell its product for $35 (ie price per unit of output). Furthermore, it faces the following costs: |Output (Q) |Total Cost |0| 25 1 50 |2 |
- Consider a firm that produces output in a perfectly competitive market. The firm's total cost curve takes the form of TC=100+10Q+Q^2 and marginal cost takes the form MC=10+2Q. The point of the minimum average total cost is Q=10. a. If the market price is
- Suppose that a firm is operating under highly competitive market conditions and that the going price for its product is p = $300 and that the firms short tun total cost function is: STC = 5000 - 250Q + 12Q^2. Determine firm's profit maximizing output and
- In a competitive industry the market-determined price is $12. A firm is currently producing 50 units of output; average total cost is $10, marginal cost is $15, and average variable cost is $7. In order to maximize profit, the firm should: a. produce more
- A firm operates in a perfectly competitive industry. Suppose it has a short-run total cost function given by TC = 42000 + 0.001q2. If the market price is 15, what is the firm's profit-maximizing quantity? (Answers must be with 2 of the true value to be c
- A firm operates in a perfectly competitive industry. Suppose it has a short run total cost function given by TC = 24000 + 0.001q^2. If the market price is 12, what is the highest profit the firm can earn?
- A firm operating in a purely competitive environment is faced with a market price of $250. The firm's total cost function is TC = 6,000 + 400Q - 20Q2 + Q3. a. Should the firm produce at this price in the short run? b. If the market price is $300, what wil
- A firm operates in a perfectly competitive industry. Continue to suppose it has a short-run total cost function given by TC = 42000 + 0.001q^2. If the market price is 15, what is the highest profit the firm can earn? (Format: answers must be with 4 of th
- If a perfectly competitive firm is facing a situation where the price of its product is lower than the average total cost, which of the following statements is true? a. Other firms will want to enter the industry because of the economic profits generated
- Consider a firm in a perfectly competitive market with total costs given by TC = Q3 - 15Q2 + 100Q + 30 a.) What is this firm's marginal cost function? b) Over what range of output are the firm's mar
- If a firm in a perfectly competitive market shuts down in the short run, it will: a) have total revenue greater than its fixed costs. b) have to do this because the price is more than the AVC. c) lose money equal to its total fixed costs. d) have no losse
- There are two firms producing identical goods. Each firm has the cost structure TC(q) = q^2 + 30. These are the only two firms in the market where the market demand for the good is P = -2Q + 50. A. Find the profit of each firm if each firm produces 5 unit
- (a) The market price for a firms product is $500 and the short run total cost function of a perfectly competitive firm is given as follows: STC=200+200Q+10Q^2+ 1/3Q^3 Find the firm�s profit-maximizin
- A purely competitive firm finds that the market price for its product is $30.00. It has a fixed cost of $100.00 and a variable cost of $17.50 per unit for the first 50 units and then $37.50 per unit for all successive units. a. Does the price equal or exc
- A firm sells a product in a perfectly competitive market. The marginal cost of the product at the current output level of 500 units is $1.50. The minimum possible average variable cost is $1. The market price of the product is $1.25. To maximize profits,
- Two firms, 1 and 2, compete in a market with demand P = 1 - Q, where P is the market price and Q is the market output. The marginal costs of firm 1 is 1/2 and firm 2 is c less than 3/4. a) Compute the
- Confronted with the same unit cost data, a monopolistic producer will charge a. the same price and produce the same output as a competitive firm b. a higher price and produce a larger output than a competitive firm c. a higher price and produce a small
- The price of a competitive firm's product is $50 per unit. The firm currently has marginal cost equal to $40. To maximize profits this firm: a. should reduce its output. b. should keep its output the same. c. needs more information to determine if it shou
Explore our homework questions and answers library
Browse
by subject