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AREC 682 > Formulas > Flashcards

Formulas Flashcards

1
Q

MC =

A

MC = derivative of TC

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2
Q

MR =

A

MR = derivative of TR

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3
Q

ATC =

A

ATC = TC/Q

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4
Q

How do we find P & Q for a normally priced consumer co-op?

A

To find P & Q for a normally priced co-op, set D=MC
aka: MVP = MC just like a producer co-op.

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5
Q

TR =

A

TR = P * Q

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6
Q

How do we find optimal Q for a consumer IOF?

A

IOF operates where MR=MC for Q

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7
Q

Where does MC = AC?

A

Where AC is at a minimum MC = AC

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8
Q

How do we find the profit of a consumer co-op?

A

Co-op profit = (MC - AC) *Q

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9
Q

Where do we find the maximum member welfare for a consumer co-op?

A

Max. member welfare where D=MC

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10
Q

What is the member welfare of a consumer co-op?

A

Member welfare = CS+Profit

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11
Q

How do we find Q for a single firm co-op that is a producer (buys inputs)?

A

Q & P @ MC = MVP

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12
Q

MPP =

A

MPP = derivative of TP = derivative of Y

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13
Q

MVP =

A

MVP = MPP*P(y)

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14
Q

How do we find the demand equation for X?

A

MVP = demand equation for X

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15
Q

NARP =

A

NARP = ((P(y)*Y)-FC)/X

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16
Q

Where is NARP at a maximum?

A

NARP is at a maximum where NARP = MVP

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17
Q

Is NARP the same for a monopsonist and a co-op?

A

Yes! NARP is the same for a monopsonist and a co-op, monopsonists just ignore it.

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18
Q

Where do we find NARP pricing?

A

NARP pricing @ NARP = MC

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19
Q

How do we find price for a consumer co-op?

A

MC = D for pricing of a consumer co-op

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20
Q

How do we find pricing for a producer co-op?

A

MC = MVP for pricing of a producer co-op.

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21
Q

What is the maximum price a producer coop can offer?

A

MVP = NARP gives us max NARP and max. pricing.
** at this price there will have to be quotas

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22
Q

How do we find P & Q for a monopoly?

A

Monopoly P & Q:
Q@ MR=MC ,
then up to D for P.

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23
Q

How do we find pricing for a competitive producer IOF?

A

MC = MVP

24
Q

How do we solve a quadratic equation?

A
25
Q

How do we find pricing for a monopsony?

A

Monopsony Q: MO = MVP
Monopsony P: MC @ Q we just found

26
Q

How do we multiply an individual’s demand curve out to an aggregate demand curve?

A

Must put the equation into the form X=___xz

27
Q

If a co-op is acting as a monopolist, how do we find member welfare?

A

CS + ((P(m)-MC)Q) + ((MC-AC)Q)

28
Q

What is minimum cost pricing (consumer co-op)?

A

AC = MC

29
Q

What is average cost pricing (consumer co-op)?

A

D = AC
*** P<MC here

30
Q

Consumer co-op pricing when members factor patronage into price?

A

AC = D
** P<MC at that point.

31
Q

MVP

A

MVP = MPP*Py

32
Q

NARP

A

NARP = ((Py*Y)-FC))/X

33
Q

How do we find the profit/patronage for a producer co-op?

A

(NARP - MVP)*Q

34
Q

TO = ?

A

Total Outlay = X * MC = X * P

35
Q

MO

A

Marginal Outlay = derivative of TO

36
Q

How do we find Q for a producer IOF?

A

MO = MVP

37
Q

What is NARP pricing for a producer co-op?

A

NARP = MC

38
Q

What is the demand equation for a producer co-op? Y is output /sold, X is input/bought.

A

Py=f(y)

39
Q

What is the supply equation for a producer co-op? Y is output/sold, X is input/bought.

A

Y = f(x) so Y = f(Px, Py)

40
Q

MPP = ?

A

MPP = derivative of Y
MPP = Change in Y / Change in X

41
Q

MVP = ?

A

MVP = MPP*Py

42
Q

How do we calculate member welfare with a producer co-op?

A

MW = ((Py * Y)-(Px * X)-FC) + ((Px * X)-Space under dx(X0))
MW = (Py * Y)-(space under dx(X0))-FC

43
Q

How do we find optimal membership for a consumer co-op?

A

Set D = MC = AC
- AC will be lowest
- MC won’t be higher than AC
- D will generally have to be a lot smaller than it currently is
you can take that price and put it back into the individual member demand curve - equal to the MVP from the individual production function before you multiply it by 24 to get aggregate demand. Then divide the total quantity you calculated at AC=MC by the individual or small x you calculated and that will tell you optimal membership.
Q (optimal membership)/X(individual)= M(ideal membership)

44
Q

Where do we find optimal membership with a producer co-op?

A

NARP = MVP = S

45
Q

How do we find TR for a producer co-op if we aren’t given an equation for it?

A

TR = P(y) * Q(y)

46
Q

When looking at a producer co-op, what is the Y=…X…. equation referring to?

A

TP

47
Q

How do we find the profit for a monopsony?

A

Profitmonopsony = (P(y) * Y)-(P(x) * X)-FC

48
Q

How do we find P for maximum pricing of a producer co-op?

A

Plug the Q we found at MVP=NARP back into either MVP or NARP. DO NOT PLUG IT INTO MC!

49
Q

If a co-op is acting as a monopolist, how do we find the total patronage?

A

((P-MC) * Q) + ((MC-AC) * Q)

50
Q

What is the value of import quota?

A

(Cost of Production - world price) * imports = import quota value

51
Q

What is the value of production quota?

A

(Cost of Production - Marginal Cost Price) * production quota = production quota value

52
Q

How do we determine how much will be imported in a quota system?

A

Imports = Qty D - Production Quota

53
Q

What’s the formula for import quota rent?

A

(Cost of Production - World Price) * (Qty D - Production Quota)

54
Q

What is NARP?

A

Net Average Revenue Pricing

55
Q

What is MPP?

A

Marginal Physical Product

56
Q

What is CS?

A

Consumer Surplus

57
Q

What is an IOF?

A

Investor Owned Firm

AREC 682 (6 decks)

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