use this the economic organisation of a pow camp http://www.jstor.org/discover/1
ID: 1242583 • Letter: U
Question
use this
the economic organisation of a pow camp
Explain how the prices determined in competitive market in theory? describe who the price were determined in P.O.W Camp. Discuss weather mechanism of price determination in P.O.W Camp is consistent with the theory?? there was an attempt to fix the prices but results in failure.. explain why the attempt failed?? Cigarette was used as currency. explain why? what was a problem caused by using cigarette as currency??
Explanation / Answer
the equilibrium price is different in the short and the long run. in the short run your equilibrium point in terms of price is where your marginal cost curve intersects your marginal revenue curve. now in teh short run depending on whether there is an excess or a shortage of firms your company will be making losses or profits respectively. in teh long run however due to the absence of barriers to entry new firms will enter or exit depending on the profits meaning that the short run price will be formulated where marginal costs and marginal revenues equal to zero.
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