Get college assignment help at uniessay writers On the basts of the three individual demand schedules below, and assuming these three people are the only ones In the soclety, determine (a) the ratket demand schedule on the assumption that the good is a prtvate good and (b) the collective demand schedule on the assumption that the good is a public good Instructions: Enter your answers as whole numbers (in the gray-shaded cells). (a) Private Demand (b) Public Demand Individual #2 Individual # 3 Individual #1 Price Qd Price Qd Price Qd Price Qd Price Qd k 1 $16 $16 $16 0 $16 2 14 2 0 14 14 2 14 3 12 12 12 0 12 3 ces 4 10 10 10 1 10 5 5 8 8 8 5 6 3 6 6 7 7 7 4 4 4 8 8 2 5 8 2 2
• Write a paper of no more than 1,050 words to summarize your findings. Your paper should include a description of the chosen product, product line, or service and a rationale for choosing that product or service. Consider the ability of that product or service to compete in the markets. Additionally, conduct an assessment of the domestic and foreign competition as you analyze the estimate of the market size, market potential, and market growth for the product or service that you have chosen.
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Bus hels) orenzo and Neha are farmers, Each one owns a 20-acre plot of land. The following table shows the amount of rve and corn each farmer can roduce per year on a given acre. Each farmer chooses whether to devote all acres to producing rye or corn or to produce rye on some of the and and corn on the rest. Rye Corn (Bushels per acre) (Bushels per acre) Lorenzo 30 10 Neha 28 7 On the following graph, use the blue line (circle symbol) to plot Lorenzo’s production possibilities frontier (PPF), and use the purple line (diamond symbol) to plot Neha’s PPF 200 O 180 Lorenzo’s PPF 100 140 120 Neha’s PPF CORN (Bushels) 200 180 Lorenzo’s PPF 100 140 120 Neha’s PPF 100 80 60 40 20 100 200 300 400 600 600 700 800 900 1000 RYE (Bushels) CORN (Bushels) O o 180 Lorenzo’s PPF 160 140 Neha’s PPF 120 100 80 60 40 20 100 200 300 400 500 600 700 800 900 1000 RYE (Bushels) has an absolute advantage in the production of rye, and has an absolute advantage in the production of corn Lorenzo’s opportunity cost of producing 1 bushel of corn is bushels of rye, whereas Neha’s opportunity cost of producing 1 bush corn is bushels of rye. Because Lorenzo has a opportunity cost of producing com than Neha, has a comparative advantage in the production of corn, and has a comparative advantage in the production of rye.
Consider two neighboring island countries called Euphoria and Arcadia. They each have 4 million labor hours available per week that they can use to produce rye, jeans, or a combination of both. The following table shows the amount of rye or jeans that can be produced using 1 hour of labor. Rye Jeans Country (Bushels per hour of labor) (Pairs per hour of labor) Euphoria 8 32 Arcadia 12 24 Initially, suppose Arcadia uses 1 million hours of labor per week to produce rye and 3 million hours per week to produce jeans, while Euphoria uses 3 million hours of labor per week to produce rye and 1 million hours per week to produce jeans. Consequently,, Euphoria produces 24 million bushels of rye and 32 million pairs of jeans, and Arcadia produces 12 million bushels of rye and 72 million pairs of jeans. Assume there are no other countries willing to trade goods, so, in the absence of trade between these two countries, each country consumes the amount of rye and jeans it produces. Euphoria’s opportunity cost of producing 1 bushel of rye is 2 pairs Y of jeans. Therefore, Euphoria of jeans, and Arcadia’s opportunity cost of producing 1 bushel of rye is 4 pairs has a comparative advantage in the production of rye, and Arcadia has a comparative advantage in the production of jeans. Suppose that each country completely specializes in the production of the good in which it has a comparative advantage, producing only that good. In this case, the country that produces rye will produce 48 million bushels per week, and the country that produces jeans will produce 128 million pairs per week NN When the two countries did not specialize, the total production of rye was 36 million bushels per week, and the total production of jeans was 104 million pairs per week. Because of specialization, the total production of rye has increased by 12 million bushels per week, and the total production of jeans has increased by 24 million pairs per week. Because the two countries produce more rye and more jeans under specialization, each country is able to gain from trade. Calculate the gains from trade-that is, the amount by which each country has increased its consumption of each good relative to the first row of the table. In the following table, enter this difference in the boxes across the last row (marked “Increase in Consumption”). Euphoria Arcadia Rye Jeans Rye Jeans (Millions of bushels) (Millions of pairs) (Millions of bushels) (Millions of pairs) Without Trade Production 24 32 12 72 Consumption 24 32 12 72 With Trade Production Trade action Consumption Gains from Trade Increase in Consumption
11. Games in which timing matters Consider an economy in which there is initially one firm, HealthyBran, in the market for breakfast cereal. A new firm, TastyCereal, is deciding whether to enter the market, which would then change the market to a duopoly. HealthyBran can choose to sell its cereal to grocery stores at either a high or a low price. As a monopolist, it can earn $6.5 million by selling at a high price or $3.5 million by selling at a low price. If TastyCereal enters the market and HealthyBran sells at a high price, each firm makes $1.5 million; if TastyCereal enters the market and HealthyBran sells at a low price, each firm has a loss of $2.5 million. Suppose that HealthyBran can’t set long-term contracts with the grocery stores that sell its cereal. The following diagram shows this game: first, TastyCereal decides whether to enter or not, and then HealthyBran decides whether to sell at a high or low price. -$2.5 Million for HealthyBran -$2.5 Million for TastyCereal Low Price Enter $1.5 Million for HealthyBran High Price $1.5 Million for TastyCereal $3.5 Million for HealthyBran Low Price $0 Million for TastyCereal Don’t Enter High Price $6.5 Million for HealthyBran $0 Million for TastyCereal TastyCereal decides HealthyBran decides Suppose Healthy Bran issues a press release saying that if Tasty Cereal enters the market, it will sell at a low price if it chose to set a low price, and it would If TastyCereal decides to enter the market despite the threat, HealthyBran would earn if it chose to set a high price. Therefore, HealthyBran’s threat enter the credible, and TastyCereal earn Now suppose that HealthyBran can sign long-term contracts with grocery stores at a set price before TastyCereal decides whether or not to enter. The following diagram shows this game: -$2.5 Million for HealthyBran -$2.5 Million for TastyCereal Enter R Low Price $3.5 Million for HealthyBran Don’t Enter $0 Million for TastyCereal A $1.5 Million for Healthy Bran $1.5 Million for TastyCereal Enter High Price C Don’t Enter $6.5 Million for HealthyBran $0 Million for TastyCereal TastyCereal decides HealthyBran decides if it chose to enter the market, and it would earn If HealthyBran decides to sign a contract at a low price, TastyCereal would earn enter the market, if it chose to stay out. Therefore, if HealthyBran signed a contract at a low price, TastyCereal and HealthyBran would earn On the other hand, if HealthyBran decides to sign a contract at a high price, TastyCereal would earn if it chose to enter the if it chose to stay out. Therefore, if HealthyBran signed a contract at a high price, TastyCereal market, and it would earn enter the market, and HealthyBran would earn Anticipating TastyCereal’s response to its pricing contract, HealthyBran will sign price. contract at a
Get college assignment help at uniessay writers 5. The price of trade Suppose that Portugal and Germany both produce fish and wine. Portugal’s opportunity cost of producing a bottle of wine is 4 pounds of fish while Germany’s opportunity cost of producing a bottle of wine is 10 pounds of fish. By comparing the opportunity cost of producing wine in the two countries, you can tell that has a comparative advantage in the production of wine and has a comparative advantage in the production of fish. Suppose that Portugal and Germany consider trading wine and fish with each other. Portugal can gain from specialization and trade as long as it receives more than of fish for each bottle of wine it exports to Germany. Similarly, Germany can gain from trade as long as it receives more than of wine for each pound of fish it exports to Portugal. Based on your answer to the last question, which of the following prices of trade (that is, price of wine in terms of fish) would allow both Germany and Portugal to gain from trade? Check all that apply. 9 poonds of fish per bottle of wine 1 pound of fish per bottle of wine 2 pounds of fish per bottle of wine 16 pounds of fish per bottle of wine
10. Collusive outcome versus Nash equilibrium Consider a remote town in which two restaurants, All-You-Can-Eat Café and GoodGrub Diner, operate in a duopoly. Both restaurants disregard health and safety regulations, but they continue to have customers because they are the only restaurants within 80 miles of town. Both restaurants know that if they clean up, they will attract more customers, but this also means that they will have to pay workers to do the cleaning. If neither restaurant cleans, each will earn $11,000; alternatively, if they both hire workers to clean, each will earn only $8,000. However, if one cleans and the other doesn’t, more customers will choose the cleaner restaurant; the cleaner restaurant will make $16,000, and the other restaurant will make only $4,000. Complete the following payoff matrix using the previous information. (Note: All-You-Can-Eat Café and GoodGrub Diner are both profit-maximizing firms.) GoodGrub Diner Cleans Up Doesn’t Clean Up Cleans Up $ $ All-You-Can-Eat Café Doesn’t Clean Up $ If All-You-Can-Eat Café and GoodGrub Diner decide to collude, the outcome of this game is as follows: All-You-Can-Eat Café and GoodGrub Diner If both restaurants decide to cheat and behave noncooperatively, the outcome reflecting the unique Nash equilibrium of this game is as follows: All- You-Can-Eat Café and GoodGrub Diner Save
10. Monetary policy and the market for bank reserves Suppose the federal funds rate not close to zero, risk spreads are roughly constant so that different interest rates rise and fall together, and banks are not holding many excess reserves. Federal Reserve open-market operations are done mostly in Treasury bills. Such economic conditions are referred to as “normal times.” bonds through open-market operations. Suppose the Federal Reserve implements an expansionary monetary policy by The following graph shows the demand and supply of bank reserves On the graph, show the effect of the Fed’s expansionary monetary policy by shifting one or both of the curves. Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. The Market for Bank Reserves 6 Supply Demand 5 Supply 2 Demand 0 0 300 600 900 1200 1500 1800 QUANTITY OF BANK RESERVES (Billions of Dollars) As a result of the Fed’s expansionary policy, the interest rate to Investment is one component of total spending. The following graph shows the demand for investment. Use the information from the previous graph to show the short-run effect of the Fed’s expansionary monetary policy by shifting the demand curve or moving the point along the curve on the following graph INTEREST RATE (Percent) Use the information from the previous graph to show the short-run effect of the Fed’s expansionary monetary policy by shifting the demand curve or moving the point along the curve on the following graph Hint: Be sure the new interest rate corresponds to the interest rate you found in the previous graph ? The Market for Investment Finder Gyazo – 6 Demand for Investment 5 3 2 Demand for Investment 150 0 30 60 90 120 180 INVESTMENT (Billions of Dollars) As a result of the Fed’s expansionary policy, the quantity of investment demanded to billion The following graph shows the aggregate demand (AD) curve in the goods and services market before the Fed implements its expansionary policy Suppose that the multiplier in this economy is 4 NOMINAL INTEREST RATE (Percent) en On the following graph, show the effect of the change in investment demand on the AD curve ond the multiplier process has run its course. Use the green curve (triangle symbol) to plot the new AD curve at price levels of 40 and 140. Hint: Use the new quantity of investment demanded you found in the Market for Investment and the multiplier to determine the exact change in aggregate demand at both price levels. Assume that this effect is independent of the price level, that is, the AD curve has a parallel shift. ? The Market for Goods and Services 160 140 New AD 120 100 AC 6C 40 AD 20 420 480 0 60 120 180 240 300 360 REAL GDP (Billions of Dollars) An expansionary monetary policy causes the quantity of bank reserves in the economy to which drives interest rates As a result, businesses invest in capital improvements such as new factories and equipment. This leads to in aggregate demand, the extent of which is determined by the simple spending multiplier. PRICE LEVEL
a plavers, Movictonia and Videotech, The following pavoff matrix shows the profit fin milions of Suppose there are only two fima that sll B dollars) each company l earn, depending on whether it sets a high or low price for its players. Videotech Pricino High Low Higr 11 11 2 13 Movictonia Pricing Low 10 10 Movictonia will milipn and videotech wil eatn a ttuft of t2 million Assume this is a simultaneuus gamer nd that Movitunia aud videnterh ate bth ittaximisinn Grm It Mavistonia prices high, Videotech will make mare profit it it choosas a price, and it Movietonia pri ces low. Videatach will make mane price. profit If it chooscr a price, and if videotech prives low, Movietunia will make mare If videotech prices high, Movietonia will make more profit if it a dco a dominant stratogy for both Movictonia and Vidootoch. Considering all cf the information clven, pricing high ll they end up thousing” f the firms do nut culude, nthich strategy Both Movictoria a Vidsatech will chcose a low prica Movieteni will choose a low orice and Videtech will choose a high price.
6. Macroeconomic stabilization: Combating unemployment and inflation The following graph shows the aggregate supply (AS) and aggregate demand (AD) curves of a hypothetical economy. Suppose that, in the absence of government intervention, the economy is in equilibrium at point E. Additionally, suppose that the price level corresponding to point E is considered too high, so the price level would be rising too rapidly if the economy were to move to point E, and that the government decides to step in to improve economic conditions. On the following graph, shift the relevant curve or curves to illustrate the result of the government intervention. O AS AD AS AD Real GDP Which of the following policies could the government use to achieve the desired outcome? Check all that apply. Price Level Which of the following policies could the government use to achieve the desired outcome? Check all that apply. Tax hikes Reduction in government spending Increases in government spending Tax cuts
TEA (Millions of pounds) TEA (Millions of pounds) n When a country has a comparative advantage in the production of a good, it means that it can produce this good at a lower opportunity cost than its trading partner. Then the country will specialize in the production of this good and trade it for other goods. The following graphs show the production possibilities frontiers (PPFS) for Freedonia and Lamponia. Both countries produce lemons and tea, each initially (i.e, before specialization and trade) producing 18 million pounds of lemon and 9 million pounds of tea, as indicated by the grey stars marked with the letter A Freedonia Lamponia 48 48 30 PPF 36 30 30 24 18 PPF 12 12 48 12 18 24 30 36 42 12 18 24 30 36 42 LEMONS (Millions of pounds) LEMONS (Millions of pounds) eedonia has a comparative advantage in the production of while Lamponia has a comparative advantage in the Suppose that Freedonia and Lamponia specialize in the production of the goods in which each has oduction of mparative advantage. After specialization, the two countries can produce a total of million pounds of tea and million pounds lemons. uppose that Freedonia and Lamponia agree to trade. Each country focuses its resources on producing only the good in which it has a omparative advantage. The countries decide to exchange 12 million pounds of lemons for 12 million pounds of tea. This ratio of goods is known s the price of trade between Freedonia and Lamponia. TEA (Millions of pounds) o NUte! Dashed drop lines will automatically extend to both axes. ? Freedonia 48 42 Consumption After Trade 36 PPF 24 18 12 C 12 18 24 30 36 42 48 LEMONS (Millions of pounds) TEA (Millions of pounds) AS you dia lor Freedonla, place a black point (plus symbol) on the following graph to indicate Lamponia’s consumption after trade. Lamponia 48 42 Consumption After Trade 24 18 PPF 12 12 18 24 30 30 42 48 LEMONS (Millions of pounds) TEA (Millions of pounds) N 42 Consumption After Trade 30 30 24 18 PPF 12 12 18 24 30 36 42 48 LEMONS (Millions of pounds) True or False: Without engaging in international trade, Freedonia and Lamponia would not have been able to consume at the after-tm consumption bundles. (Hint: Base this question on the answers you previously entered on this page.) True O False
Happyland is one of five amusement parks on Sunshine Island. The following graph shows Happyland’s kinked demand curve (Di- D2) and the (MR MR2). The graph also shows two possible marginal cost curves (MCi and MC2) resulting marginal revenue curve ? 72 68 60 MR 1 54 48 42 36 MC 30 24 MC 18 12 6 MR, 2 0 0 3 6 12 15 18 21 24 27 30 33 38 QUANTITY (Millions of tickets per year) Assume Happyland’s marginal cost is represented by MC1. Happyland will set a price of per ticket According to the kinked demand curve model, if one firm its price, other firms will do likewise to retain their market share, but if one firm its price, other firms will not follow suit. Therefore, if one of Happyland’s competitors decreases its price to below the price you just found for Happyland, Happyland will The basic principle behind the kinked demand curve model explains why the D2 portion of the kinked demand curve is relatively elastic than the D1 portion If Happyland’s marginal cost decreased from MC1 to MC2 on the graph, Happyland would PRICE (Dollars per ticket)
Policy Variability and Economic Growth 612 REVIEW OF ECONOMIC STUDIES The type of policies we consider are given by the level and distribution of investment subsidies. Many policies, such as investment tax credits and regional or sectoral subsidies to investment fall into this category. The scope is even broader if one considers other policies which, indirectly, have a similar effect, such as tariffs or import quotas, quantitative allocation of credit or foreign exchange and, investment licenses or other regulatory HUGO A. HOPENHAYN University of Rochester and Universitar Pompeu-Fabra requirements and The growth effects of distortionary government policies were first analysed by Easterly (1992), Jones and Manuelli (1990) and King and Rebelo (1990). By altering the rate of return to capital, these policies can either stimulate or discourage investment in different sectors of the economy, thus affecting their capital accumulation rates. In particular, any distortion that increases the price of one capital good will have a negative impact on growth. If instead the distortion decreases the price of one capital good, the result will be the reverse (i.e. there will be too much growth). This literature has not considered the MARIA E. MUNIAGURRIA University of Wisconsin-Madison Firt oersion receiond August 1994: fal ersion accepted Jne 1996 (Eds) This paper explores the effect of policy variability (or frequency of regime switching) on econcmic growth and welfare. We study a one-sector growth model where investment can be subaidined at either a positive rate ee not subsidined at all. We fnd that the lack of persistence in policies per se need not be welfare reducing and that it is ikely to decrease growth. Higher variability implies more frequent changes in consumption and investment. But, by ereating a stronger intertemporal link across regimes, variability reduces the fluctuation in investment rates thes decreasing the magnitode of changes in consumption and increasing welMfare. effects of persistence of policy regimes-or policy variability on growth. Aizenman and Marion (1993) study the effects of policy uncertainty (defined as the gap between two policy regimes) and persistence in a model with two possible profit tax regimes (high or low). They find that increases in policy uncertainty can have positive or negative effects on growth depending on the degree of regime persistence and the magnitude of the policy fluctuation. They show that in the absence of persistence, policy uncertainty does not affect growth. Our paper focuses, precisely, on the implications of the degree of policy persistence on the level and characteristics of growth and on welfare. . INTRODUCTION We analyse a linear neoclassical growth model and, as in Aizenman and Marion (1993), identify regimes with very specific policies. We take these policies as given and do not model the political process by which they are instituted or changed. This is obviously a simplification with respect to the models of endogenous policy determination considered by the literature on intertemporal politico-economic equilibrium (for a survey see Persson and Tabellini (1990)). Different degrees of policy persistence could result from voting models as a consequence of different institutional arrangements (e.g. length of appointments or majority rules for overturning decisions) or as part of the multiple equilib The connection between government policies and economic growth has recently received considerable attention. For the case of developing countries, the work of Chenery et al. (1986), Easterly and Wetzel (1989) and Krueger (1978) suggests that policies that distort relative prices and resource allocation are an important source of differences in perform ance among countries. Examples of such policies are differential import tariffs, export and investment subsidies, allocation of foreign exchange and taxes (see Easterly (1992)). Policies not only differ across countries, but there is also a significant variation over time within countries. Often as a consequence of political instability, regimes with different economic incentives alternate over time, with different degrees of persistence. According ria that some of these models exhibit. We study a one-sector growth model where investment is subsidized at a uniform to Easterly, King et al. (1991) the government current expenditure variables-like con- rate but this rate can be either positive or zero. Thus there are two possible regimes: the sumption and education spending-are quite persistent.’ Harrison (1991) finds that over subsidy and no-subsidy regimes. Subsidies are financed with lump sum taxation. The degree the last thirty years most developing countries have experienced large variations in com of policy variability of an economy is given by the arrival rate of a regime switch. The setup is similar to Aizenman and Marion (1993), but with two differences. Firstly, we The purpose of this paper is to analyse the implications of such policy variability or allow for income effects, which by assumption are absent in their setup. Secondly, as regime switching on the level and characteristics of economic growth. Though there is a indicated above, we focus on policies that affect the cost of investment rather than its mercial and exchange rate policies. fairly widespread view that the lack of persistence could lead to slower growth and reduced welfare, to our knowledge no serious theoretical attempt has been made to consider the question in a more rigorous way. This paper explores this issue in a neoclassical growth return. 3. Easterly (1992) uses data for developing countries and his results suggest that distortions have a signin ant fect on p t of papers includes Alesina (987), Alesina and Rodrik (1994 Alesina and Tabellini model. An incomplete (1989) and Tabellini (1994 Kr ad ( Sveral ef these papen t the idea of poltical cycls as an important source of (policy) shocks, providing an explanation for the lack of policy I. As an example they fod that the cross section correlation between 1960’s and 1970’s for government education spending is 075 while for trade orientation is 0 56 2. See aho FIEL (1988) and (1990) for the case of Argentina per o ensider our quetion within that dass of modds would result, at the very last, in the need of making overly simplfvin aenative, which is the one we chose, was to take a standard growth model, sch as the ones used in the eptions for the sake of tractability without an obvious gain in insights. Am analysis of distortionary policies mentioned above, and as a first approsimation abstract from the process of policy detemination KEVIEW O ECONOMIC STUDIES D14 The results obtained for this one-sector model show that, surprisingly, higher vari where k,-ak/ar 6. There is a large number (constant over time) of identical agents that ability leads to higher welfare and it is likely to decrease growth. The mechanism by which are endowed with an initial amount of capital. Agents maximize expected utility defined. increased welfare results is an interesting one, where income effects play a crucial role. as UEeu(e)dt, where p>0 is the constant rate of time preference, e, is consump- Since there are no externalities in capital accumulation, investment subsidies lead to an tion at time r and, e) is the instantaneous utility. We assume that ue) is of the constant intertemporal distortion and excessive investment in periods of subsidy. This raises the elasticity type so the expected utility is: value of consumption in periods of subsidy and, in anticipation, the expected return on investment in periods of no subsidy. Consequently, in periods of no-subsidy investment is also above its corresponding value for a zero-subsidy economy: subsidies to investment spill over to periods of no subsidy. Higher variability implies more frequent changes in the level of investment and con- where a >0 is the reciprocal of the intertemporal elasticity of substitution. sumption. Because a stronger intertemporal link across the two regimes, investment increases in periods of no subsidy and decreases in periods of subsidy. This reduces the there are two possible regimes: one where investment is subsidized at a constant rate amplitude of the fluctuations in consumption, thereby increasing welfare. We prove that average long-run growth rates increase with variability when the latter 0r0 is a time invariant productivity parameter. Capital depreciates at rate
40 35 Profit Max P.Q 30 25 Sales Max P.Q AC Scratch TR/Profit 15 10 5 MC MR 0 35 40 0 10 15 20 25 30 QUANTITY (DVDS per day) Fill in the following table with the price and quantity the firm chooses when it aims to maximize profit versus sales. (Hint: You may use the purple point (diamond symbol) and green point (triangle symbol) to help you derive this answer. You will not be graded on where you place these points on the graph.) Under Profit Maximization Under Sales Maximization Price Quantity Total Revenue $ Profit If a firm aims to maximize sales revenue, it will charge a price and produce output than under profit maximization. PRICE (Dollars per DVD)
Note: Dashed drop lines will automatically extend to both axes. ? 100 Monopolistic Competition Outcome 80 70 Perfectly Competitive Outcome 60 50 AC 40 30 20 MC D 10 MR 0 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of jackets) Compare the average cost and the production level in the long-run equilibrium for a monopolistically competitive firm and a perfectly competitive firm by completing the following table. Production Level Average Cost (Thousands of jackets) Under… (Dollars per jacket) Monopolistic Competition Perfect Competition Because this market is a monopolistically competitive market, the firm’s average cost in long-run equilibrium is the long-run average cost it would achieve as a firm operating in a perfectly competitive market. The production level of a monopolistically competitive firm in long-run equilibrium is the production level of a perfectly competitive PRICE, COSTS, AND REVENUE (Dollars per jacket)
2. How short-run profit or losses induce entry or exit Fantastique Bikes is a company that manufactures bikes in a monopolistically competitive market. The following graph shows Fantastique’s demand curve, marginal revenue curve (MR), marginal cost curve (MC), and average cost curve (AC) Place the black point (plus symbol) the graph to indicate the short-run profit-maximizing price and quantity for this monopolistically competitive on company. Then, use the green rectangle (triangle symbols) to shade the area representing the company’s profit or loss. Note: Dashed drop lines will automatically extend to both axes. Select and drag the rectangles from the palette to the graph. To resize, select one of the points on the rectangle and move to the desired position 500 450 Monopolistically Competitive Outcome 400 350 AC Profit or Loss 300 250 200 150 100 MC 50 MR Demand 0 50 100 150 200 250 300 350 400 450 500 QUANTITY (Bikes) Given the profit-maximizing choice of output and price, the shop is earning profit, which means there are shops in the industry than in long-run equilibrium. Now consider the long run in which bike manufacturers free to enter and exit the market. are Show the possible effect of free entry and exit by shifting the demand curve for a typical individual producer of bikes on the following graph. Note: Select and draq the curve to the desired position. The curve will snap into position, so if you try to move a curve and it snaps back to its PRICE (Dollars per bike) Note: Select and drag the curve to the desired position. The curve will snap into position, so if you try to move a curve and it snaps back to its original position, just drag it a little farther. ? Demand 1 QUANTITY (Bikes) PRICE (Dollars per bike)
The post Question: On The Basts Of The Three Individual Demand Schedules Below, And Assuming These Three People Are The Only Ones In The Soclety, Determine (a) The Ratket Demand Schedule On The Assumption That The Good Is A Prtvate Good And (b) The Collective Demand Schedule On The Assumption That The Good Is A Public Good Instructions: Enter Your Answers As Whole Numbers … appeared first on uniessay writers.