Bartech, Inc. is a firm operating in a competitive market. The manager of Bartech forecasts product price to be $28 in 2015. Bartech's average variable cost function is estimated to beAVC = 10 ? 0.003Q + 0.0000005Q2Bartech expects to face fixed costs of $12,000 in 2015. Now, suppose that the 2015 price forecast is drastically revised downward to $5. What is Bartech's profit-maximizing (or loss-minimizing) output for 2015?
A. 4,000 units
B. 0 units
C. 3,000 units
D. 2,000 units
E. 1,000 units
Answer: B
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Allocative efficiency occurs only at that output where
A. the areas of consumer and producer surplus are equal. B. marginal benefit exceeds marginal cost by the greatest amount. C. the combined amounts of consumer surplus and producer surplus are maximized. D. consumer surplus exceeds producer surplus by the greatest amount.
What is meant by producer surplus? How is producer surplus in a competitive market calculated?
What will be an ideal response?
Fiscal policy is determined by the Federal Reserve System
Indicate whether the statement is true or false
Which of the following is NOT a condition for price discrimination to exist?
A) downward sloping demand curve faced by the firm B) identification of buyers with differing elasticities C) unpatented product or the service D) ability to prevent the resale of the product or service