(c) If the festival organizers wanted to set an economically
efficient price of $1.25 per soda, how would
this change the results from part (b)? Would
Coastal be willing to provide sodas for the festival
at this regulated price? Why or why not?
44. A retiree from a large Atlanta financial services firm
decides to keep busy and supplement her retirement
income by opening a small upscale folk art company
near Charleston, South Carolina. The company, Sand
Dollar Art, manufactures and sells in a purely competitive
market, and the following monthly market
information for x units at $p per unit applies:
Demand: p 5 2000 2 4.5x
Supply: p 5 100 1 0.25x
(a) Find the market equilibrium quantity and price for
this market.
(b) If Sand Dollar Art’s monthly cost function is
C1x2 5 400 1 100x 1 x2
find the profit-maximizing monthly quantity. What
are the total monthly revenues and total monthly
costs? What monthly profit does Sand Dollar Art
earn?
(c) Assuming that Sand Dollar Art is representative of
firms in this competitive market, what is its market
share
(c) If the festival organizers wanted to set an economically
efficient price of $1.25 per soda, how would
this change the results from part (b)? Would
Coastal be willing to provide sodas for the festival
at this regulated price? Why or why not?
44. A retiree from a large Atlanta financial services firm
decides to keep busy and supplement her retirement
income by opening a small upscale folk art company
near Charleston, South Carolina. The company, Sand
Dollar Art, manufactures and sells in a purely competitive
market, and the following monthly market
information for x units at $p per unit applies:
Demand: p 5 2000 2 4.5x
Supply: p 5 100 1 0.25x
(a) Find the market equilibrium quantity and price for
this market.
(b) If Sand Dollar Art’s monthly cost function is
C1x2 5 400 1 100x 1 x2
find the profit-maximizing monthly quantity. What
are the total monthly revenues and total monthly
costs? What monthly profit does Sand Dollar Art
earn?
(c) Assuming that Sand Dollar Art is representative of
firms in this competitive market, what is its market
share
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