PPT-The Multi-Output Firm

MICROECONOMICS Principles and Analysis Frank Cowell Almost essential Firm Optimisation Useful but optional Firm Demand and Supply Prerequisites July 2015 1 Note the detail in slides marked can only be seen if you run the slideshow. MICROECONOMICS. Principles and Analysis. . Frank Cowell . Almost essential . Firm: Demand and Supply. Prerequisites. July 2015. 1. Note: the detail in slides marked “ * ” can only be seen if you run the slideshow. TRADITIONAL MODELS OF IMPERFECT COMPETITION. 2. Pricing Under Homogeneous Oligopoly. We will assume that the market is perfectly competitive on the demand side. there are many buyers, each of whom is a price taker. The World of Oligopoly:. Preliminaries to Successful Entry. The profit-maximizing output for the gadget monopoly. 2. If there are no other market entrants, the entrepreneur can earn monopoly profits that are equal to the area dcba.. Theory of The Firm. Learning Objectives . Describe using examples, the assumed characteristics of the perfectly competitive market.. Explain, using a diagram the shape of the PC’s AR, MR, MC.. Explain, using a diagram, that it is possible for PC markets to make economic, normal and negative profit in the short-run based on MC and MR rule. . maximization. Economic profit = total revenue - all economic costs. Economic costs include accounting cost. (. explicit. . costs. ). and opportunity costs (implicit. . costs. ).. Profit maximization. MICROECONOMICS. Principles and Analysis. . Frank Cowell. July 2015. 1. Almost essential. Monopoly. Useful, but optional. Game Theory: Strategy and Equilibrium. Prerequisites. Overview. July 2015. 2. Competition. U. nit Overview. Assumptions. of the Perfectly Competitive Model. Large. number of sellers. Homogeneous product. No entry barriers. Perfect information. Profit Maximization in the Short-run. Pure (or Perfect). Competition. Pure Monopoly. Number of Firms. VERY large number of firms. Only ONE firm. The firm IS the industry. Price making abilities of individual firms. Each firm is so small that changes in its own output do not affect market price, i.e. firms are price takers. The profit-maximizing output for the . monopoly. 2. If there are no other market entrants, the entrepreneur can earn monopoly profits that are equal to the area dcba.. Quantity . 0. Price,. Cost . AC. Zhaoliang. . Lun. Matheus Gadelha. Evangelos. . Kalogerakis. Subhransu . Maji. Rui. Wang. Image from Autodesk 3D Maya. Creating 3D shapes is not easy. Goal: 2D line drawings in, 3D shapes out!. ShapeMVD. Short . run and the long run. The . relationship between a firm’s output and labour employed in the short run. The . relationship between a firm’s output and costs in the short run and derive a firm’s short-run cost curves. PREPARED BY. ANINDITA CHAKRAVARTY. We now proceed to explain the determination of price and output when there exists price leader­ship by a dominant firm which is having a large share of the market with a number of small firms as followers each of which has a small share of the market. . Leadership . Prepared by. ANINDITA CHAKRAVARTY. Economists have developed various models concerning price-output determination under price leadership making different assumptions about the . behaviour. Duna Jogeswar Rao. Price & Output Determination under perfect Competition. Under perfect competition, the buyers and sellers cannot influence the market price by increasing or decreasing their purchases or output, respectively. The market price...