Economic topic: 1. Assume that the demand function and supply function of a perfectly competitive market are QD = 50000-2000p and QS = 40000 + 3000P respectively Find the manufacturer's demand function

Economic topic: 1. Assume that the demand function and supply function of a perfectly competitive market are QD = 50000-2000p and QS = 40000 + 3000P respectively Find the manufacturer's demand function

Can't you understand the manufacturer's demand function? Does the manufacturer want to buy raw materials?
What you have given above is the supply function of a single manufacturer under the general technical conditions of the market. Can you find the supply function of the market?
Because the market is completely competitive, the market supply function is a horizontal line, P = 2. The solution method is the same as that of equilibrium price

Calculation problem: suppose that the demand function and supply function of a perfectly competitive market are QD = 50000-2000p and QS = 40000 + 3 respectively Demand: market equilibrium price and equilibrium output qs=40000+3000p

The intersection of demand curve and supply curve is the equilibrium price. After obtaining the equilibrium price, the equilibrium output can be obtained
50000-2000p=40000+3000p
P = 2 (equilibrium price)
Q = 46000 (balanced output)

Suppose that the demand function and supply function of a perfectly competitive market are QD = 50000-2000p and QS = 40000 + 3000 respectively

It seems to be 40000 + 3000P
Simultaneous equation QD = y = 50000-2000p QS = y = 40000 + 3000P
qs=qd=y=46000
p=2
Equilibrium price 2
Equilibrium production 46000

What is the law of diminishing marginal return?

This is the famous law of diminishing marginal return in economics. \ x0d reason for the existence of the law of diminishing marginal return is that with the increase of variable factor input, the proportion between variable factor input and fixed factor input is changing. In the initial stage of variable factor input increase, compared with fixed factors, variable factor input is too small, so, As the input of variable factors increases, its marginal output increases. When the matching ratio of variable factors and fixed factors is appropriate, the marginal output reaches the maximum. If the input of variable factors continues to increase, there will be relatively too many variable factors because the number of other factors is fixed, Therefore, the marginal output will inevitably decrease. \ x0d or because there is an optimal combination ratio between the input of variable factors and the input of constant factors for the production of any product. \ x0d to correctly understand this law, we need to pay attention to the following points: \ x0d first, with the continuous increase of variable factors, the change of marginal products will experience increase and decrease, Finally, it becomes the whole process of negative number. Increasing is because the potential efficiency of fixed factors does not play out when there are few variable factors. Once the potential efficiency of fixed factors is played out, the marginal production begins to decline. The significance of this law is that when a factor increases continuously, there will be a decreasing trend of marginal products sooner or later, Instead of stipulating that it decreases at the beginning. \ x0d secondly, the law of diminishing marginal return is only applicable to the production function of variable factor proportion. If the factor proportion is fixed, this law does not hold. \ x0d finally, the premise of the law of diminishing marginal return is that the technical level remains unchanged. If the technical level changes, this law does not exist. In history, Malthus, a British economist, did not consider the long-term technological progress and mistakenly predicted the consequences of population growth. \ x0d the law of diminishing marginal return raises a problem for us. Since the increase of variable factor input eventually leads to the decrease of total output, then, It is necessary for manufacturers to understand the optimal input of variable factors, which involves the analysis of three stages of output

Give an example to illustrate the law of diminishing marginal return?

"One monk carries water to eat, two monks carry water to eat, and three monks don't have water to eat..." this ancient story was made into a film many years ago, and now it is familiar in many forms such as songs. People love the story of three monks not only because its plot is interesting, but also because it contains far-reaching philosophy. From the perspective of economics, The story of the three monks confirms a law: diminishing marginal returns
The law of diminishing marginal return (return) is an empirical law, that is, the result of long-term observation
On the premise that the technical level remains unchanged, continuously increase the number of elements input, and when the number of elements is less than a specific value
When factor input increases, output increases. When it exceeds a specific value, it begins to decrease
For example, in the work of washing clothes, one person can wash them, one person is responsible for drying them, and one person is responsible for drying them. 3
The output of an individual is much higher than that of an individual. This is also the result of division of labor
But if 20 people do it (without adding washing, drying and drying equipment), some people will
Start chatting and joking. It will also affect others, thus reducing output
As the saying goes, "more people beat up the mess, more chickens don't lay eggs." that should be the truth

Why does it produce the law of diminishing marginal return? I know the concept and understand it. The question is what is the initial reason for the formation of this law

The so-called diminishing marginal return means that on the premise that other conditions remain unchanged, the increase of output gradually decreases after an additional unit of production factor is added
Take the simplest example: Chinese people like many people and think that many people have great power, which is actually a fallacy
How many tons of grain can a mu of land produce at most? Suppose it is 2 tons. At first, one person + 1 mu is 0.5 tons, and then two people + 1 mu can increase the output by 0.5 tons, so the total output is 1 ton. But it is not saturated, because this mu of land can produce 2 tons of grain. So three people + 1 mu can increase by 0.3 tons, so the total output increases to 1.3 tons, but after adding the third person, the output only increases by 0.3 tons, When the second person was added before, the output increased by 0.5 tons
Why did this happen? Because the land here is assumed to be unchanged, only 1 mu. With the input of labor force (i.e. the continuous increase of people), what will happen if the marginal income increases or remains unchanged? That is, as long as there is one mu of land and more people are allowed to cultivate, countless tons of grain will be produced, which is impossible, because the maximum output of one mu of land can only be 2 tons. The increase in the number of people only helps this mu of land reach the maximum output. And such an increase must be decreasing, because if it is increasing or increasing at a constant rate, Then the whole world only needs one mu of land
In the final analysis, an important premise of diminishing marginal return is that the input of other factors of production remains unchanged