Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The market determined price in a perfectly competitive industry is P = Rs. 10. Suppose that the total cost equation of an individual firm in

The market determined price in a perfectly competitive industry is P = Rs. 10. Suppose that the total cost equation of an individual firm in the industry is given by the expression

TC 1000+2Q+0.01Q2

a) What is the firm's profit-maximizing output level and profit? Is this profit normal profit or supper normal profit? Justify your answer (10 marks)

b) At profit maximizing level what is firm total cost, total revenue and marginal cost (10 Marks)

c) Why does a competitive firm is considered as a price taker and Monopoly firm as a price maker (05 Marks)

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_2

Step: 3

blur-text-image_3

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

Business Law

Authors: Henry Cheeseman

8th Edition

0133130649, 9780133130645

More Books

Students also viewed these Economics questions

Question

1. Effort is important.

Answered: 1 week ago