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Pls help and show work Product X is sold in a perfectly competitive, constant-cost industry a. Draw a side-by-side graph for product X showing the
Pls help and show work
Product X is sold in a perfectly competitive, constant-cost industry a. Draw a side-by-side graph for product X showing the market in longrun equilibrium with an individual rm earning normal prot. Label each of the following: it The market's equilibrium price (PE) and quantity (05) ii. The rm's prot-maximizing quantity (05) b. How would it affect the quantity sold or transacted if the government imposed a price ceiling above PE? c. The price of Z, a substitute for product X, increases. Illustrate on your graphs from part (a) the result of this in the short run. i. Label the new market price (P2) and new market quantity (02). ii Shade completely any prot or loss for the rm. do The price of Z increased by 20 percent, while the quantity demanded of X changed by 40 percent, What is the cross-price elasticity of X and Z? e What happens to the productive efciency of the rm in the short run as a result of the change described in part (c)? f What will happen to the price of X in the long run? Explain g In long-run equilibrium, the individual rm produces 100 units of X, At that level of output, its total cost is $500. If the rm is earning normal prots, what must be the market price? h The whole market from part (g) clears at a quantity of 1 million units in the long run. If the constant long-run supply would intersect the y-axis at $1 and the demand curve intersects the yaxis at $9, what is the consumer surplus? Market Price Price From Supply MC ATC E P = AR- MR Demind Onty E QE QulyMarket From Price Price Supply Profits MC E ATC P' P E P= AR-MR Demonic Demand onty QutyStep by Step Solution
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