A company in perfect competition has the total cost function: C(q) = 50 + 0.5 q...

A company in perfect competition has the total cost function:

C(q) = 50 + 0.5 q + 0.08 q²

a. Determine what is the long-run equilibrium price level and the corresponding output of the firm..

b. If the company experiences a technological improvement that reduces its costs by 25%, what is the equilibrium quantity of the company in the short term if the market price is the one found in point a.

Expert Solution

Rahul Sunny answered 2 years ago

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