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79. 81. 82. 85. EXERCISE 25 The market for tablets has grown increasingly competitive. Assume producers of tablets all rely on the same technology and face the same costs. The cost function for a tablet manufacturer is given by the following function: co) = I; 1092 + 2001;. wherey stands for the number of tablets produced and sold in a month. Suppose the market demand for tablets in any month is given by Q5 = 560 p. In the long-run equilibrium, how many tablets will be sold monthly? What will be the equilibrium price? Suppose all tablet manufacturers have been using a free, open-source operating system. The company behind this software, however, has decided to impose a monthly operating system fee on each tablet manufacturer. The monthly fee equals $385 and does not depend on how many tablets a manufacturer produces and sells. In the short run, what will be the price of a tablet? What will be the quantity of tablets bought and sold every month? With the fee in place, in the short run, rms will be earning a. negative prots. b. positive prots. c. zero prots. EXERCISE 26 Marijuana remains illegal in many places, but demand is consistently present, and a black market supply exists to meet it. The black market is competitive, and marijuana can be produced at a constant marginal cost of $126 per ounce; assume for simplicity that there are no xed costs. However, there is a risk that sellers may be caught selling marijuana or possessing large quantities. Assume that an arrest and charge of possession will result in a ne of $1000, and there is a 3% chance of getting caught with marijuana for each ounce that is sold. Demand for marijuana is represented by D91) 2 507 23). What is the black-market price for an ounce of marijuana? How many ounces of marijuana are sold in the market? Economics 2A Quiz 2, Fall 2021 13 86. 87. Now suppose that marijuana is legalized, so there is no longer a risk of getting caught and ned. It is, however, subject to a tax of $30 per ounce. The market otherwise remains the same in terms of costs and demand. What is the new legal market price for an ounce of marijuana? How much tax revenue is generated