Essay
The squishy industry is competitive and the market price is $0.80. Apu's long-run cost function is: C(q, r) =
, where r is the price Apu pays to lease a squishy machine and q is squishy output. The long-run marginal cost curve is: MC(r, q) = 0.218
. What is Apu's optimal output if the price Apu pays to lease a squishy machine is $1.10? Suppose the lease price of squishy machines falls by $0.55. What happens to Apu's optimal output if the market price for a squishy remains at $0.80? Did profits increase for Apu when the lease rate of squishy machines fell?
Correct Answer:

Verified
The profit maximizing output level is wh...View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Correct Answer:
Verified
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
Q33: In many rural areas, electric generation and
Q49: In the long run, a firm's producer
Q56: If managers do not choose to maximize
Q59: The market demand for a type of
Q89: In the short run, a perfectly competitive
Q92: Marginal profit is negative when:<br>A) marginal revenue
Q96: An industry has 1000 competitive firms, each
Q106: The table below provides cost information for
Q112: Consider a competitive market in which the
Q144: A firm never operates:<br>A) at the minimum