Question: Consider a monopolistically competitive firm whose cost is given by C = 2 + 2Q + Q 2 , and its demand function is given

Consider a monopolistically competitive firm whose

cost is given by C = 2 + 2Q + Q 2 , and its demand function is given by

Q =32 - 4P.

(1) Find the optimal price and quantity of output in the short run.

(2) What long-run adjustments should you expect? Explain.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Q:

(20 points)Consider a monopolistically competitive firm whose cost is given by C = 2 + 2Q + Q 2 , and its demand function is given by Q =36 - 4P. (1) Find the optimal price and quantity of output in...

Q:

Consider a monopolistically competitive firm whose cost is given by C = 2 + 2Q + Q 2 , and its demand function is given by Q =32 - 4P. (1) Find the optimal price and quantity of output in the short...

Q:

Consider a monopolistically competitive firm whose cost is given by C = 2 + 2Q + Q 2 , and its demand function is given by Q =36 - 4P. (1) Find the optimal price and quantity of output in the short...

Q:

Consider a competitive firm whose cost is given by C = 60 + 2Q + 4Q 2 . The product sells at $26 per unit. (1) Find the optimal quantity of output in the short run. (2) Evaluate the profitability of...

Q:

Consider a competitive firm whose cost is given by C = 4 + 4Q + Q 2 , and its inverse demand function is given by P = 9 - Q/4. The product sells at $30 per unit. (1) Find the optimal price and...

Q:

Firm 1 is a member of a monopolistically competitive market. Its total cost function is C = 900=60Q12. The demand curve for the firm's differentiated product is given by P = 660 - 16Q1. a. Determine...

Q:

Dalia owns a small coffee roasting firm in Manchester. She is in a monopolistically competitive market and so has some market power. The inverse demand function that she faces is given by PP=38 -...

Q:

1.1) The production function of the firm is F( l ) = 4 l + 2 l ^2 l ^3 l [0, 2]. (1) a. Compute for the proper domain. Indicate the image for each one (a) AP( l ) (b) MP( l ) b. Determine the value...

Q:

Mathematics for economics ABBE 2823 MATHEMATICS FOR ECONOMICS DBF 1 / DEC 1 / DFI 1 TUTORIAL 10 (WEEK 6) DIFFERENTIATION QUESTIONS 1 . Find and classify the stationary points of the following...

Q:

Question 1. (10 points)Which characteristics make a monopolistically competitive firm competitive? Question 2. (10 points)Why P = MC cannot be a condition for an optimal quantity of output for a...

Q:

What is the fair value option?

Q:

A=h((b_(1)+b_(2))/(2)), where A is area, b_(1) and b_(2) are the length of the bases, and h is the height, to answer the question. How many square feet of grass are there on a trapezoidal field with...

Q:

In a money market fund you won't have to worry about losing your debt expenses capital gains principal

Q:

Multiple Select Question Select all that apply You have observed what you think may be unethical behavior in the workplace. Which of the following are ways to speak up constructively? " If this...

Q:

For the daily cell phone sales of Example 5.6, find the cutoff point for the top 10% of all daily sales.

Q:

5.20 Let the random variable X follow a normal distribution with m = 80 and s2 = 100. a. Find the probability that X is greater than 60. b. Find the probability that X is greater than 72 and less...

Q:

Whole Life Organic, Inc., produces high-quality organic frozen turkeys for distribution in organic food markets in the upper Midwest. The company has developed a range feeding program with organic...