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Supply and Marginal Costs in Perfect Competition

Explore how quantity and costs change with varying prices in perfect competition scenarios. Understand ATC, AVC, and MC implications. Analyze total supply, firm pricing, cost breakdown, shutdown decisions, and economic costs.

zephr-horton
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Supply and Marginal Costs in Perfect Competition

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  1. Supply and Marginal Costs… Perfect Competition

  2. QTY TFC TVC TC ATC AVC MC 0 $30 $ 0 $30 $5 $5 5 $35 1 30 35 4.50 4 9 19.50 30 2 39 5 6 15 30 3 15 45 5.50 7 13 30 4 22 52 6 8 12 30 5 30 60 7.50 15 12.50 30 6 45 75 9.71 23 14 30 7 68 98

  3. QTY TFC TVC TC ATC AVC MC 0 $30 $ 0 $30 $5 $5 5 $35 1 30 35 4.50 4 9 19.50 30 2 39 5 6 15 30 3 15 45 5.50 7 13 30 4 22 52 6 8 12 30 5 30 60 7.50 15 12.50 30 6 45 75 9.71 23 14 30 7 68 98 WHAT IF P IS $15?

  4. PRICE QUANTITY $15 6

  5. QTY TFC TVC TC ATC AVC MC 0 $30 $ 0 $30 $5 $5 5 $35 1 30 35 4.50 4 9 19.50 30 2 39 5 6 15 30 3 15 45 5.50 7 13 30 4 22 52 6 8 12 30 5 30 60 7.50 15 12.50 30 6 45 75 9.71 23 14 30 7 68 98 WHAT IF PRICE WERE $23?

  6. PRICE QUANTITY $15 6 $23 7

  7. QTY TFC TVC TC ATC AVC MC 0 $30 $ 0 $30 $5 $5 5 $35 1 30 35 4.50 4 9 19.50 30 2 39 5 6 15 30 3 15 45 5.50 7 13 30 4 22 52 6 8 12 30 5 30 60 7.50 15 12.50 30 6 45 75 9.71 23 14 30 7 68 98 WHAT IF PRICE WERE $8?

  8. PRICE QUANTITY $8 5 $15 6 $23 7

  9. QTY TFC TVC TC ATC AVC MC 0 $30 $ 0 $30 $5 $5 5 $35 1 30 35 4.50 4 9 19.50 30 2 39 5 6 15 30 3 15 45 5.50 7 13 30 4 22 52 6 8 12 30 5 30 60 7.50 15 12.50 30 6 45 75 9.71 23 14 30 7 68 98 WHAT IF PRICE WERE $7?

  10. PRICE QUANTITY $7 4 $8 5 $15 6 $23 7

  11. QTY TFC TVC TC ATC AVC MC 0 $30 $ 0 $30 $5 $5 5 $35 1 30 35 4.50 4 9 19.50 30 2 39 5 6 15 30 3 15 45 5.50 7 13 30 4 22 52 6 8 12 30 5 30 60 7.50 15 12.50 30 6 45 75 9.71 23 14 30 7 68 98 WHAT IF PRICE WERE $6?

  12. PRICE QUANTITY $6 3 $7 4 $8 5 $15 6 $23 7

  13. QTY MC 0 $5 1 2 4 3 6 4 7 5 8 15 6 23 7

  14. SUPPLY QTY MC 0 PRICE QUANTITY $5 1 2 4 $6 3 3 6 4 $7 4 7 5 $8 5 8 $15 15 6 6 7 $23 23 7

  15. SUPPLY SUPPLY FIRM A FIRM B PRICE QUANTITY PRICE QUANTITY 10 $6 $6 3 $7 $7 11 4 $8 5 $8 12 $15 $15 13 6 7 $23 $23 14

  16. SUPPLY SUPPLY FIRM A FIRM B PRICE QUANTITY PRICE QUANTITY 10 $6 $6 3 $7 $7 11 4 $8 5 $8 12 $15 $15 13 6 7 $23 $23 14 TOTAL SUPPLY PRICE QUANTITY 13 $6 15 $7 $8 17 $15 19 $23 21

  17. COST ATC AVC MC ATC AVC MC OUTPUT

  18. COST MC MC OUTPUT

  19. COST MC MR = 23 MR = 15 MR = 8 MC 6 7 5 OUTPUT

  20. PRICE S QUANTITY

  21. PRICE S PRICE = 23 PRICE = 15 PRICE = 8 6 5 7 QUANTITY

  22. COST = SUPPLY MC MR = 23 MR = 15 = P MR = 8 MC 6 7 5 = QUANTITY SUPPLIED OUTPUT

  23. COST = SUPPLY AVC MC MR = 23 MR = 15 = P AVC MR = 8 MC 6 7 5 OUTPUT

  24. COST ATC AVC MC ATC AVC MC P = MR SHUTDOWN OUTPUT

  25. DRIVING RANGE IMPLICIT EXPLICIT COSTS COSTS PER MONTH PER MONTH $5000 LAND LABOR $1000 $2000 $1000 CAPITAL ENTRE- $500 PRENEURIAL ABILITY RAW $500 MATERIALS _ _ + $7500 $2500 $10000 Total Economic Cost

  26. QTY MC 0 $5 1 2 4 3 6 4 7 5 8 15 6 23 7

  27. SUPPLY QTY MC 0 PRICE QUANTITY $5 1 2 4 $6 3 3 6 4 $7 4 7 5 $8 5 8 $15 15 6 6 7 $23 23 7

  28. S PRICE QUANTITY WHEAT

  29. S PRICE QUANTITY WHEAT

  30. S PRICE MC QUANTITY WHEAT

  31. S PRICE MC QUANTITY WHEAT

  32. (AND MARGINAL S SOCIAL COSTS) PRICE QUANTITY WHEAT

  33. (AND MARGINAL S SOCIAL COSTS) PRICE $3 MC=$3 7000 QUANTITY CORN

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