Question: Demand is A and average cost is B. A = 3,000 - 3Q B = 1 500 = constant A stands for price per unit

Demand is A and average cost is B.

A = 3,000 - 3Q

B = 1 500 = constant

A stands for price per unit and Q is the number of units measured in 1,000.

There are no substitutes or competitors this units. The maximum price is 2,000 per unit.

a)How does the producer's profit and market power change as a result of price regulation?

b)Assume they want the maximum production volume from a) and are considering to adjust the maximum price accordingly.

Which maximum price gives the highest production, and how much will they produce?

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:

Joint Product Cost AllocationAverage Unit Cost and Market Value Methods. Sage Products Company pro duces three products from a joint source. A single raw material is introduced into Process I from...

Q:

Please help me to compute the following questions and appreciate to see your computations. Thank you B D E F Blade 5 Financial information provided in the case 17 7 6 Kahuna Total 7 Total unit sales...

Q:

Please help me to compute (show your computation) the following questions using the case study of Kookabura Bats.Thank you T B D E F Blade 5 Financial information provided in the case 17 7 6 Kahuna...

Q:

Q This document has all of the instruction in it. please contact me if you have any questions. Download Attachment: (1) On October 5, Narveson Company buys merchandise on account from Rossi Company....

Q:

QUESTION 2.3 CA Ltd is a small engineering factory which manufactures two different products in two production departments, In addition, a canteen is run as a separate department Product A R60 1500...

Q:

Figure: Consumer Surplus ||l Price of book 559 012345 Quantity of books Reference: Ref 4-23 Figure: Consumer Surplus I\" (Figure: Consumer Surplus III) In the figure Consumer Surplus III, when the...

Q:

1. Managerial accounting: A. is unregulated. B. produces information that is useful only for manufacturing organizations. C. is based exclusively on historical data. D. is regulated by the Securities...

Q:

a) Calculated the Net Present Value (as a 1 January Year 1) of each of the options available to Newton Electronics Ltd b) Identify and discuss any other factors that Newton Electronics Ltd should...

Q:

Sales Budget For the Year Ended December 31 Quarter 1 2 3 Year 4,000 Sales in Units Selling Price per unit Total Sales 3,000 $ 6 $ 18,000 5.000 $6 $ 30,000 5.000 $6 $ 30,000 17,000 $6 $ 102,000 $...

Q:

help Cost Allocation and Lower-of-Cost-or-Market Hall Company's beginning inventory and purchases during the fiscal year ended December 31, 20--, were as shown. Units Unit Price Total Cost January 1...

Q:

In a study conducted by the Department of Human Nutrition and Foods at the Virginia Polytechnic Institute and State University the following data on the comparison of sorbic acid residuals in parts...

Q:

A taxpayer, a calendar-year corporation, wants to change its company's headquarters -currently consisting of a ten-story building. The company owns the building outright. The taxpayer has identified...

Q:

When is a 100 percent sample justified?

Q:

Company Law In your opinion, how does the auditor, company secretary and directors work together to ensure compliance with the Companies Act 2016 and the company's constitution? Where possible, use...

Q:

15. Now rank from 1 to 5 the areas that you think are most important to emphasize when communicating with others (1 is least important and 5 is most important to you). If you think it all depends on...

Q:

12. The form of creative action strategy, where would you say you have a strength, as a dreamer, as a realist or as a critic?

Q:

16. Now put the areas you have ranked in order of priority and reflect on which values they correspond to in your value hierarchy.