Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Microeconomics Expert

A future recession greatly affects the daily market demand for Maine lobsters, which can be described as QD = 3000 + 250I - 250P (I is the average American income in $1000s). Thanks to the recession, that average income falls from $32,000 to $24,000.

All lobster fisherman are identical and face the same relationship between their total daily costs and daily output (q): TC = ½*q2+4q + 200. You should assume that market output is the sum of all firm output (Q = N*q, where N is the number of lobster fishermen). Use this information to answer the following problems.

a) Graph the pre-recession and post-recession demands for lobster. In the short-run, what happens to the price of lobster? (A simple graphical analysis is appropriate, you should not attempt to give a numerical answer)
b) What is the efficient scale (i.e., at what q are average total costs minimized) for lobster fishermen?
c) Before the recession, there were 250 lobster fishermen. Was the industry in long-run equilibrium? Find that scenario's market price, total output, each firm's output, and each firm's profits.
d) After the recession, the 250 lobster fishermen continue to go out and fish.
i) What is each fisherman's profit-maximizing output now?
ii) Find the market price and the total output.
iii) How large of a loss are the fishermen incurring?
iv) In the short-run, will these fishermen continue to operate or shut down (i.e., leave their boats idle at the dock)?
e) Find the long-run equilibrium number of fishermen in the post- recession market for lobsters. How many fishermen had to exit?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M940642

Have any Question? 


Related Questions in Microeconomics

Topic minimum wage workers who actually are minimum wage

Topic: Minimum wage workers _ Who actually are minimum wage workers? _ What are the profites of raising minimum wage? _ What are the con's of raising minimum wage? _ What in your opinion should we do about minimum wage?

Problem setthis problem set is due on monday october 24th

Problem Set This problem set is due on Monday, October 24th in class. Consider the specific factors model (2 goods, 3 factors, where labor is the flexible factor) for a given small country with the following Cobb-Douglas ...

Economics and quantitative analysis assignmenttopic -

ECONOMICS AND QUANTITATIVE ANALYSIS ASSIGNMENT TOPIC - REGRESSION ANALYSIS Instructions - Background One of the biggest challenges in the higher education sector has been the recent growth of online universities. The Onl ...

Scenario descriptionbigjet plans to launch a weekly flight

Scenario Description Bigjet plans to launch a weekly flight on a long-haul route. It faces four sets of decisions corresponding to short-run, medium-run, long-run, and very long-run operations. Short Run: In the short ru ...

1 this question is for discussion in teamsas the semester

1. This question is for discussion in teams. As the semester progresses. we will discuss these issues in class. Visit The World Factbook at https://www.cia.govlibrarypublications:The-world-factbook'. In "Please select a ...

Economics assignmentcontentselect a news article with

Economics Assignment Content: Select a news article with economic implications within the previous six months and explain, analyze and expand the issue using the economic concepts and theory learned in this class. Includ ...

Assignment emerging economies and Assignment: Emerging Economies and Globalization

Assignment: Emerging Economies and Globalization Background Markets in developed economies are approaching saturation level. Therefore, MNCs are searching for new untapped markets in emerging countries such as India and ...

Assignmentin this assignment you must break a norm this

Assignment In this assignment, you must break a norm. This breach must be done in a public forum. You will be writing an essay about your experiment, in which you must be sure to answer all of the questions listed in thi ...

Goal construct a case studyresearch paper that examines a

Goal: Construct a case study/research paper that examines a firm in the U.S. from a microeconomic standpoint and provide suggestions based on your findings. Step 1: Choose a firm for your focus. In addition to picking a ...

Assignmentquestion a daoism amp confucianism as fisher

Assignment Question A: DAOISM & CONFUCIANISM. As Fisher states in our textbook, "Individuals often harmonize the apparently opposite characteristics of Daoism and Confucianism in their own lives." In what specific ways m ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen