Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 8 10 pts The graph below displays the short-run cost curves for Paola's Pears, a small farm competing in the perfectly competitive pear market.

image text in transcribedimage text in transcribedimage text in transcribed
Question 8 10 pts The graph below displays the short-run cost curves for Paola's Pears, a small farm competing in the perfectly competitive pear market. $7 $6 MC $5 $4 ATC Price of Pears $3 AVC $2 $1 0 100 200 300 400 500 600 700 800 Pounds of PearsQuestion 10 20 pts An inventor has recently produced a new innovative product, a Dooder. The inventor has successfully received a patent for the Dooder and is now operating as a monopolist. The cost curves and market demand curves for Dooders is shown below. $16 $15 $14 $13 $12 I _ _. -2- $11 $10 $9 $8 $7 $6 $5 Price Per Dooders $4 $8 $2 $1 12 3 46 67 89 10111213141516 Quantity of Dooders (a) What is the prot maximizing output for the monopolist? |:| (b) What price will the monopolist charge? |:| (c) How much revenue is the monopolist bringing in?|:| (d) How much total prot is obtained by the monopolist? |:| Please enter without any units or dollar signs. (If you answer is fteen Dooders, just put 15. If your answer is three hundred dollars, just put 300i Question 13 15 pts Consider the market for Dragonre hot sauce sold in the US. The act of processing the chili peppers into the sauce creates a strong offensive odor in are surrounding the Dragon re factory. As a result the marginal social cost and the marginal private cost of producing the sauce diverge, as seen on the graph below. $10 $9 MSC $8 '5' E o 3 ax Price per Bottle 8? i 0 5 10 15 20 25 30 35 Quantity of Bottles (Thousands) a) In the absence of government intervention, how many bottles of hot sauce are produced in this market? :| (Please enter your answer with out the "thousands", ex. if the answer is 35,000, enter 35) b) What is the efcient amount of hot sauce produced in this market? |:l c) If the government were to levy a tax on hot sauce. What is the appropriate per bottle tax that would lead this market to the efcient outcome? :' (Please enter only the value of the tax, do not add "per bottle" or "each" or anything like that)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Quality Of The Environment An Economic Approach To Some Problems In Using Land, Water, And Air

Authors: Orris C Herfindahl, Allen V Kneese

1st Edition

1317386663, 9781317386667

More Books

Students also viewed these Economics questions

Question

How to find if any no. is divisble by 4 or not ?

Answered: 1 week ago

Question

3. An initial value (anchoring).

Answered: 1 week ago

Question

4. Similarity (representativeness).

Answered: 1 week ago