In the kiwi market there are 10 farms each with a supply curve given by Qs = 6. There are 10 consumers in the market each with a demand curve given by Qd= 10-p . Also, the marginal cost is zero when producing less than 6 kiwis but after that the marginal cost is 200 dollars for producing any more kiwis above 6. Find:
a) the aggregate demand curve
b) the aggregate supply curve
c) The perfect equilibrium price + quantity in this kiwi market. What is the profit on each individual kiwi farm and the total profit of all 10 kiwi farms put together
But now, all 10 farms come together and become 1 big monopoly farm. The marginal cost for producing less than 60 kiwis will be 0. The marginal cost for producing above 60 kiwis will be 200 dollars.
d) find the quantity this new monopoly will produce? the amount of profit for this monopoly?
e) calculate the amount of producer and surplus for when there were 10 separate farms and when there is just 1 monopoly farm
Please show your working out
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