To summarize the schedule for later this month:
Nov. 18: No class. You are expected to watch the video linked to on BlackBoard. This link is available now.
Nov. 20: No class. Assignment will be posted to BlackBoard during regular class times on this day.
Nov. 25: Test 3 will be given, as scheduled, in class.
***
Note the InTrade graphic below. InTrade predicted with 100 percent accuracy the results of the presidential election.
***
What assumptions are necessary for the perfect competition model? How realistic are they?
Why are firms operating in perfectly competitive markets considered price takers? Why do competitive firms produce at an output level at which marginal revenue equals marginal cost.
How does the competitive firm decide on the profit-maximizing level of output?
How does the competitive firm decide on the profit-maximizing level of output? Why is the average cost curve important in this model? Where do average fixed costs show up?
How are competitive firms earning a normal profit affected when costly "homeland security" regulations are imposed on them? If these firms start earning economic losses, then will they have to exit the market? Explain.
Farmers are often heard to complain about the high costs of machinery, labor, and fertilizer, suggesting that these costs drive down their profits. Does it follow that if, for example, the price of fertilizer fell by 109 percent, farming (highly competitive industry with low entry barriers) would be more profitable? Explain.
Nov. 18: No class. You are expected to watch the video linked to on BlackBoard. This link is available now.
Nov. 20: No class. Assignment will be posted to BlackBoard during regular class times on this day.
Nov. 25: Test 3 will be given, as scheduled, in class.
***
Note the InTrade graphic below. InTrade predicted with 100 percent accuracy the results of the presidential election.
***
What assumptions are necessary for the perfect competition model? How realistic are they?
Why are firms operating in perfectly competitive markets considered price takers? Why do competitive firms produce at an output level at which marginal revenue equals marginal cost.
How does the competitive firm decide on the profit-maximizing level of output?
How does the competitive firm decide on the profit-maximizing level of output? Why is the average cost curve important in this model? Where do average fixed costs show up?
How are competitive firms earning a normal profit affected when costly "homeland security" regulations are imposed on them? If these firms start earning economic losses, then will they have to exit the market? Explain.
Farmers are often heard to complain about the high costs of machinery, labor, and fertilizer, suggesting that these costs drive down their profits. Does it follow that if, for example, the price of fertilizer fell by 109 percent, farming (highly competitive industry with low entry barriers) would be more profitable? Explain.
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