Question
Explain the profit maximisation strategy for perfectly competitive firm. a)In Sydney market, demand for ACER is given by the equation P = 30 - 2Q
- Explain the profit maximisation strategy for perfectly competitive firm.
- a)In Sydney market, demand for ACER is given by the equation P = 30 - 2Q and supply of ACER is given by the equation P = 6 + 4Q. If Sydney market is in equilibrium, determine the equilibrium price (P) and quantity (Q) of an ACER and show the equilibrium condition in a graph. (3 marks)
b)From the equilibrium in part d), if price of an ACER decreases to $16, what would be the quantity demanded for ACER, show this using a graph. In this case, calculate the price elasticity of demand for ACER. (3 marks)
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The End Of Poverty Economic Possibilities For Our Time
Authors: Jeffrey D Sachs, Bono
1st Edition
0143036580, 9780143036586
