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Question continued...........

d) As this is perfect competition, new firms may enter the market and compete these profits away. What therefore will ensure that only normal profits are made?

e) The answer to part d) should be the same as the answer to c (4), why?
In Progress...
If we assume that a given bus market is in competition which charges a flat fare of N$1, and if the formula for the total demand (in thousands) in the market is given by the equation:

Qd = 250-60P

Where Qd is the quantity demanded in thousands at a given price P.
If we further assume constant returns to scale, then:

a) What is the total demand at the N$1 flat fare?
b) If the market is shared equally by 4 firms, what is the number of passengers per vehicle carried by each company?
c) If the cost per vehicle kilometer is N$1.60, average utilization 20 passengers per vehicle kilometer and average trip distance 10 kilometers:

i) What is the level of bus kilometers required to service this market?
ii) What profits are being made?
iii) What type of profit is this, normal or abnormal?
iv) What is the cost per passenger carried (as opposed to the cost per vehicle kilometer)?
In Progress...
A consumer utility function given u(x,y)=in(x+2y-y2/2 )find indirect utility function of consumer.
In Progress...
A monopolist’s demand curve is given by P = 100 – 2q.
(a) Find his marginal revenue function.
(b) At what price is marginal revenue zero
In Progress...
How do you reconcile the difference in the shape of the curve in the short run and the long run?
In Progress...
How do you reconcile the dif
ference in the shape of the
curve in the short run and the long run
In Progress...
Find all the Nash equilibrium of the following game:
Player1
Player 2
Left Right
Up (5,4) (1,3)
Down (4,1) (2,2
In Progress...
Assume that there are four firms supplying a homogenous product.They have identical cost function given by C(Q)=40Q.If the demand curve for the insdustry is given by U=100-Q,find the equlibrium insdutry output if the producers are cournot copetitors.What would be the result market price?What are the profits of each firm?
In Progress...
A stream of water flowing horizontally with a speed of 10m/s gushes out of a tube of crossectional area 10cm2 and hits a vertical wall nearby the force extracted the wall by impact of water (assume it rebounded)
1) 500N. 2) 20N. 3) 100N. ) 200N
In Progress...
A 6kg bomb at rest exploded into three equal pieces P,Q,R .if P and Q fly with equal speed 20 m/s making an angle 60 degree with each other.The angle between the direction of P and R is..
1) pai/4. 2) pai/2. 3) 3pai/4. 4) 5pai/6
In Progress...
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