Production-Cost Duality; Input Price Changes and Isocost-Isoquant Analysis; Long-Run Competitive Equilibrium

1 ( Production-Cost Duality) If all firms in an industry have constant returns-to-scale production functions, what can we say about the efficient (e.g. cost-minimizing) plant size in the long-run? 2 (Input Price Changes and Isocost-Isoquant Analysis) Given the recent economic slowdown, a number of policy makers have ...continues

Monopoly Pricing and Output

3 (Monopoly Pricing and Output) Shelley works at University florist in Minneapolis. Every Friday night, the owner of the florist shop gives her the unsold inventory of roses at no cost, which Shelley then sells on Riverside Avenue to pedestrians and motorists. Shelley has a monopoly on rose sales in this area, and faces a d ...continues

Tariffs

4 (Tariffs) Rice is traded in a competitive world market. At the world price of $0.10 per pound, unlimited amounts of rice can be imported into Japan for purchase in the Japanese rice market. (e.g. There is an infinite supply of rice at the world price of $0.10 per pound.) The domestic demand and supply of rice in Jap ...continues

temporary differentials vs. equilibrium differentials in factor prices

1. Which of the following are temporary differentials and which are equilibrium differentials in factor prices? a. Differences in earnings of football coaches and wrestling coaches. b. A "bonus for signing on" offered by a construction company seeking carpenters in a tight labour market. c. Differences in monthly rent char ...continues

Economic rent and transfer earnings

Can you please explain the relationship between " economic rent " and " transfer earnings" ? Thank you.

i would like a detailed answer. Thank you for the help.

In light principle-agent theory, why might dentists and attorneys be required to subscribe to professional codes of ethics that prevent (or at least limit) their ability to sell unneeded services to their clients? Why do we not see similar codes of ethics for automobile mechanics?

price/profit maximization

Demand Function for a textbook: P=100-.005Q. The publisher must pay $20 per book in prinitng and distribution costs, and in addition, it must pay the author a $20 royalty for each book sold. A) How can I find which price will maximize the publisher's profit? How much profit will be earned exactly? And what will be the total roy ...continues

Supply and Demand Funtions

P=200-3Q P=20+Q A) How do I know which equation is supply and which is demand? How can I calculate the amount of shortage or surplus that would prevail at a price of $25 per unit? In terms of economic surplus, who gains and who loses? B) Using the same supply and demand equations, can you explain and determine graphically ...continues

Elasticity of Demand

A) In response to increasing thefts by drug addicts, the government passes legislation increasing both the penalty and probability of punishment for suppliers of illegal drugs. What would be a good prediction of what would happen to the rate of property crime committed by drug addicts if the price elasticity of demand for illega ...continues

Calculating a Cournot Equilibrium - industrial economics

1. The industry demand function facing two oligopolists is p = 100 - 0.5y1 - 0.5y2, where yi is the production of firm i, and p is the price of their homogeneous output. Each firm has a cost function of the form ci = 10yi (a) Calculate the Cournot level of output for each firm. (b) Calculate the output for each firm when fir ...continues