10 The Market For Hotel Rooms In Florida Is A Perfectly Competitive Market For The Hotel That Your Cousin Owns He Has 1 (29.12 KiB) Viewed 33 times
10 The Market For Hotel Rooms In Florida Is A Perfectly Competitive Market For The Hotel That Your Cousin Owns He Has 2 (13.74 KiB) Viewed 33 times
10. The market for hotel rooms in Florida is a perfectly competitive market. For the hotel that your cousin owns, he has the following cost structure: TVC = 3002 – 17850, TFC = 26700. Market price is $15. a. What is the profit maximizing output that the firm should produce? (4 points) b. What is total profit? (4 points) c. There are 423,000 hotels in Florida, and each has the same cost structure as your cousin's hotel (TVC = 30Q2 - 1785Q and TFC = 26700). What is the market supply curve for hotel rooms in Florida? (5 points)
d. What if the variable cost was instead TVC = 3003 - 178502 +265570, find the price below which the firm will no longer want to produce (that is, no longer want to supply). (6 points)
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