Using two correctly labeled graphs show the coffee market side by side with Basti’s Coffee. Show the long run adjustments in each of the following: i. price and quantity in the coffee market ii. price and quantity for Basti’s Coffee
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Basti’s Coffee operates in a competitive market. The short run
Basti’s Coffee average variable cost.
Using two correctly labeled graphs show the coffee market side by side with Basti’s Coffee. Show the long run adjustments in each
of the following:
i. price and quantity in the coffee market
ii. price and quantity for Basti’s Coffee
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- Basti’s Coffee operates in a competitive market. The short run price in the coffee market is equal toBasti’s Coffee average variable cost. Using two correctly labeled graphs show the coffee market side by side with Basti’s Coffee. Show the long run adjustments in eachof the following:price and quantity in the coffee market ii. price and quantity for Basti’s CoffeeBasti’s Coffee operates in a competitive market. The short run price in the coffee market is equal to Basti’s Coffee average variable cost. a. Using two correctly labeled graphs show the coffee market side by side with Basti’s Coffee. Clearly indicate which graph represents the market and which represents Basti’s Coffee. In your graph identify: i. price and quantity in the coffee market (3) ii. price and quantity for Basti’s Coffee (3) iii. The area of economic profit or loss for Basti’s Coffee (3)Assume that the market for pasta is in long-run equilibrium and that the pasta industry is a constant-cost industry. Explain with a graph and words what will happen to the price and quantity in the market when the demand for pasta decreases.
- A market is in long-run equilibrium and firms inthis market have identical cost structures. Supposedemand in this market decreases. Describe whathappens to the market quantity as the market leavesand then returns to long-run equilibriumBasti’s Coffee operates in a competitive market. The short run price in the coffee market is equal toBasti’s Coffee average variable cost.a. Using two correctly labeled graphs show the coffee market side by side with Basti’s Coffee. Clearlyindicate which graph represents the market and which represents Basti’s Coffee. In your graph identify:i. price and quantity in the coffee market ii. price and quantity for Basti’s Coffee iii. The area of economic profit or loss for Basti’s Coffeeb. In a new set of graphs for both the market and Basti’s Coffee, show the long run adjustments in eachof the following:i. price and quantity in the coffee market ii. price and quantity for Basti’s CoffeeThe following table gives you cost and revenue information for Mac & Kayla's Stacked Sandwiches, which are sold in a perfectly competitive market. Sandwiches Total Cost Variable Cost Average Total Cost Marginal Cost Revenue 0 $20 1 $30 2 3 4 5 6 $64 $28 $88 www $19 $21 $90 Use the above information. Answer in an integer format, with no commas, dollar signs, or decimals. What is the price of a sandwich?
- QUESTION 3 Figure: Cost Curves for Corn Producers Price, cost of bushel $30 26 22 18 14 10 مان 6 2 0 1 MC 2 3 4 5 6 7 Quantity of corn (bushels) ATC AVC The market for tomatoes is perfectly competitive. The market price of a bushel of tomatoes is $18. At the profit ]maximizing quantity of output in the figure, the farmer's total revenue is , total cost is , and profit isThe table shows some cost data for Frank's Fortune Cookies which operates in a perfectly competitive market. At a market price of $42.83 a batch, what quantity does Frank's produce and what is the firm's economic profit in the short run? When the market price is $42.83 a batch, Frank produces batches of cookies. When Frank produces 6 batches of cookies, Frank's economic profit is $ Total Average Average product (batches fixed cost variable Average cost total cost Marginal cost per day) (dollars per batch) 1 77.00 45.00 122.00 31.00 2 38.50 38.00 76.50 23.01 3 25.67 33.00 58.67 20.99 4 19.25 30.00 49.25 26.00 5 15.40 29.20 44.60 33.98 6 12.83 30.00 42.83 51.02 7 11.00 33.00 44.00 77.04 8 9.63 38.50 48.13Attempts: Average: 12 5. Profit maximization and shutting down in the short run Suppose that the market for sports watches is a competitive market. The following graph shows the daily cost curves of a firm operating in this market. V ATC AVC PRICE (Dolars per watch) 100 5 MO 0 0 10 20 30 40 50 60 70 80 90 100 QUANTITY(Thousands of watches) For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that quantity, using the data from the previous graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down, it will produce. (Hint: You can select the purple points [diamond symbols] on the previous graph to see precise information on average variable cost.) Price Quantity (Dollars per watch) (Watches) 25.00 40.00 65.00 Total Revenue Fixed Cost Variable Cost (Dollars) (Dollars) (Dollars) 520,000 $20,000 520,000 (Dollars) If the firm shuts down,…
- Suppose Eileen runs a small business that manufactures shirts. Assume that the market for shirts is a competitive market, and the market price is $20 per shirt. The following graph shows Eileen's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for shirts quantities zero through seven (inclusive) that Eileen produces. 200 175 Total Revenue 150 125 Total Cost Profit 100 50 25 -25 1 3 4 6 7 QUANTITY (Shirts) Calculate Eileen's marginal revenue and marginal cost for the first seven shirts she produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity. (?) 40 Marginal Revenue Marginal Cost 1. 5 6 7 8 QUANTITY (Shirts) Eileen's profit is maximized when she produces shirts. When she does this, the marginal cost of the last shirt she produces is $ which is v than the price Eileen receives…Suppose Hubert runs a small business that manufactures shirts. Assume that the market for shirts is a price-taker market, and the market price is $10 per shirt. The following graph shows Hubert's total cost curve. Use the blue points (circle symbol) to plot total revenue, and the green points (triangle symbol) to plot profit for the first seven shirts that Hubert produces, including zero shirts. TOTAL COST AND REVENUE (Dollars) 125 100 75 50 25 -25 -50 0 0 1 2 ☐ ■ U 3 4 5 QUANTITY (Shirts) L 6 Total Cost 7 8 Total Revenue Profit ? Calculate Hubert's marginal revenue and marginal cost for the first seven shirts he produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost.Figure: Cost Curves for Corn Producers Price, cost of bushel $30 26 MC 22 18 ATC AVC 14 10 1 3 4 7 Quantity of corn (bushels) Reference: Ref 12-3 (Figure: Cost Curves for Corn Producers) Look at the figure Cost Curves for Corn Producers. The market for corn is perfectly competitive. If the price of a bushel of corn is $10, in the short run, the farmer will produce of corn and earn an ec omic equal to 2 bushels; profit; $0 2 bushels; loss; just more than $80 per bushel 3 bushels; profit; loss, -$15 4 bushels; profit; just less than $80 per bushel