MANAGERIAL ECONOMICS
(ECO404)
ASSIGNMENT NO.02
Requirement as per given assignment:
Being a student of Managerial Economics, carefully analyze above graphs and calculate
the following for WAPDA:
A. Short Run Profit
B. Long Run Profit
C. Consumer Deadweight Loss
D. Producer Deadweight Loss
E. Total Deadweight Loss
F. Amount of Consumer Surplus that is transferred to Producer Surplus
Solution:
A. Short Run
Profit
Total Revenue = 500 x 7 = 3500
Total Cost = 500 x 5 = 2500
Profit = 3500 – 2500 = 1000
B. Long Run
Profit
Total Revenue = 700 x 4 = 2800