Suppose the market demand for milk is Qd = 150 - 5P. Additionally, suppose that a dairy's variable costs are VC = 2Q2 (where Q is the number of gallons of milk produced each day), its marginal cost is MC = 4Q and there is an avoidable fixed cost of $50 per day. In the long run there is free entry into the market. Suppose the demand for milk doubles. How many total active firms are in the market in the long run due to the increased demand?
A. 10
B. 20
C. 100
D. 2
A. 10
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A decrease in the quantity of resources available causes a movement down along a given PPF
Indicate whether the statement is true or false
If the price of a product increases
A. total revenue will definitely decrease. B. total revenue will definitely increase. C. consumer surplus will decrease. D. consumer surplus will increase.
When designing public policies, which income group would philosopher John Rawls argue needs the most attention?
a. Individuals located in the bottom fifth of the income distribution. b. Individuals located at the average income level. c. Individuals located in the top fifth of the income distribution. d. Individuals located in the top five percent of the income distribution.
What particular characteristic do public goods and club goods have in common?