8:00 I was wondering if a monopoly would have a producer surplus? Or do we only look at economic profit? Even for a normal monopoly firm, would there be a producer surplus because it doesn't makes sense that PS exist for a monopoly? Also your reviews helps me a lot with elaborating on what my teacher taught as review. Also I miss classes for being a senior so this gives full info on everything. Keep on producing, you have positive externality.
Yes, here the PS would include the shaded profit, but keep shading down to the MC curve ( easiest if MC is just a linear upward sloping curve connected to the y-axis). On a single price monopoly it's from the price to the demand curve then shade down to the MC ( again, easiest with a straight upward sloping MC). Thank you! Good luck with your exams!
Hello i was solving practice exam and i found this question can you help me A firm uses capital and labor in its production process. The marginal product for the last unit of labor is 5, the marginal product for the last unit of capital is 10, and the wage is $10. At what cost of hiring each unit of capital would the firm be minimizing the cost of the current output? (A) $5 (B) $10 (C) $15 (D) $20 (E) $50
You can learn about the equation for this in this video: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-ipwrRvEjV-E.htmlsi=_5A3HrSmViUDqzeu MPL/PL = MPK/PK is the least cost combination of resources. MP is marginal product, P is price, L is for labor, and K is for capital. Plug in the numbers and solve for the price of capital. I hope that helps!
