Homework Answers
Answer
Option 4
the equilibrium in the market is at Qd=Qs
where
P=$8
and at the price, the firm produces at P=MC
where
Q=30 units
P>ATC so the firm makes an economic profit in the short run
which attracts new firms in the market in the long-run up to the
profit is zero.
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representative firm in this perfectly competitive industry.
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are their total costs?
B) What is the short-run equilibrium price?
C) At the short-run equilibrium price, what is the quantity
produced by each firm?
D) At the short-run equilibrium price, what is per-firm
profit?
E) In the long-run,...
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