Consider a model of increasing returns to scale with symmetric firms. Algebraically show what the equilibrium...
Consider a model of increasing returns to scale with symmetric firms. Algebraically show what the equilibrium number of firms, price, and average cost must be, in terms of their equation relating price to the number of firms p= c + (1/b*n) and average cost to the number of firms AC = Fn / (S+c).
c- is constant marginal cost
b - is constant term representing the responsiveness of a firm’s sales to its price
n- is the number of firms in industry
F - fixed cost
S- he total sales of the industry (aka market size)
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Consider a model of increasing returns to scale with symmetric
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options are: constant returns increasing
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Yes or
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capital is involved in producing 300 automobiles a day?
_______ workers and _______ units of capital
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