Costs of regulation

Market demand and cost revenue relations: P=$5000 -$0.25Q MR=$5000 - $0.5Q^2(squared) TC=$6,000,000 + $500Q +$0.5Q^2(squared) MC+$500+$1Q Marginal cost: $150 per unit, OSHA mandated safety feature A. Calculate profit-maximizing price/output combination and economic profit level before installation of the OSHA mandated shielding equipment B Calculate same after the OSHA guidelines have been met. Who pays the economic burden of meeting OSHA guidelines?

Monopoly regulation

Cable co: Demand curve for monthly service: P=$37.50 -$0.0005Q.This implies annual demand and marginal revenue curves of: P=$450 -$0.006Q MR=$450-$0.012Q where P is service in dollars and Q is no. of customers served.Total and marginal costs per year(before investment return) are described by the function: TC=$4,275,000+$75Q+$0.0015Q^(squared) MC=$75+$0.003Q The co.has assets of $1.5 million and the utility commission has authorized a 15% return on investment. A. Calculate profit-max price(monthly and annually), output, and rate of return levels. B. What monthly price should commission grant to limit cable co. to a 15% rate of return? (please explain all steps used in calculatio... click for more

Concentration Ratio

Concentration ratios: A. overstate the relative importance of firms in local markets B. ignore potential entrants C. measure the degree of buyer concentration D. understate the relative importance of domestic firms when import competition is important Which answer makes the most sense and why?

Relative employment levels

When Px=$60, MPx=5 and MPy=2, relative employment levels are optimal provided: A.Py=16.7cents; B.Py=$24; C.Py=$60; D.Py=$150 Could you please explain how to do this calculation?

Productivity

If the productivity of variable factors is decreasing in the short-run: a. marginal cost must increase as output increases b. average cost must decrease as output increases c. average cost must increase as output increases d. marginal cost must decrease as output increases