Question

Profit Maximization and Long Run Equilibrium 0 MC ATC AVC 150 200 250 300 350 400 450 500 $9.00 $9.60 $10.50 $11.48 $12.60 $15.00 $18.60 $19.05 $23.20 $19.20 $16.50 $15.65 $15.09 $15.00 $15.33 $16.50 $13.20 $11.70 $10.50 $10.65 $10.80 $11.25 $12.00 $13.50 The above table is the information for a firm that produces Iphone cases. Q The table below is the market demand for Iphone cases in the market. P $6.00 500,000 $7.40 475,000 $8.20 450,000 $9.00 425,000 $9.60 400,000 $10.50 375,000 $12.60 350,000 $13.20 336,000 $15.00 300,000 $16.80 275,000 $17.60 250,000 $18.60 225,000 $13.20-200,000 $14.00 175.000 $44.80 150,000

Answer 1

5.

A. Long equilibrium price is where ATC is minimum and equals to MC and equal to 15 and quantity is 400

B. 300000 iphones are sold at a price of 15

C. No of firms = equilibrium quantity/quantity sold by each firm = 300000/400=750