Suppose there are 20 competitive firms in a market. The supply curve of each firm is q = 2p. The market demand is Q = 200 - 2p. What is the residual demand curve facing a typical firm?
What will be an ideal response?
The residual demand curve is equal to the market demand curve minus the supply of all the other firms. The supply of the other 19 firms is 38p. The residual demand is 200 - 40p.
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The international agreement on intellectual property administered by the WTO is known as __________.
A. GATT B. NAFTA C. TRIPS D. WTOP
Pennsylvania's largest grower of fresh-to-market tomatoes announced in March 2009 he will no longer produce the crop. The acreage he previously devoted to tomatoes and pumpkins will be converted to field corn that is harvested by machines
Of the following, which could have led to the shift from labor intensive tomato production to field corn? A) The market price of tomatoes increased. B) Farm workers' reservation wage fell. C) The wage rate for farm workers increased. D) All of the answers are true.
If price is above average variable cost and below average total cost, a profit-maximizing price taker should
a. immediately shut down; failing to do so is contrary to the idea of profit maximization in a competitive market. b. continue producing as long as it expects the market price to rise above average total cost in the near future. c. attempt to push price upward by slowly reducing output. d. cut price so more units can be sold.
Hyperinflation may cause the collapse of the market system.
Answer the following statement true (T) or false (F)