Answer:
Given:
C(y) = y ² + 2y + 4
MC = d(C(y)) / dy
= 2y + 2
MC = P
2y + 2 = 8 (Given: P = $8)
2y = 6
y = 3
The firm produce at this price is 3 units
Suppose a firm in a perfectly competitive market has the cost function c(y)= y2 + 2y...
Suppose a firm in a perfectly competitive market has the cost function c(y)=y2 + 2y +4 Now suppose that there is a sudden increase in demand that raises the market price to p= 8. If the demand stays at this new level, what will the long-run quantity be for each firm?
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