ECON 3030 Chapter Notes - Chapter 22-23: Root Mean Square, European Cooperation In Science And Technology, Economic Rent
8 Jan 2018
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Econ 3030 - chapter 22 - firm supply. Firms face three di erent constraints when deciding on how much output to produce and what price they can charge: 3. technological constraints (production function) economic constraints (cost function) market constraints. Market environment - the way rms respond to each other when they make pricing and output decisions. A market is purely competitive if each rm assumes that the market price is independent of its own level output. Pc rm: max py - c(y) p = mc(y) py - cv(y) p > avc(y) Producers" surplus = py - cv(y) - f + f. Econ 3030 - chapter 23 - industry supply. In a competitive industry with free entry pro ts cannot deviate too far form zero.
