An industry is perfectly competitive. Each firm is identical and has a total cost function T...

An industry is perfectly competitive. Each firm is identical and has a total cost function T C(q) = 50 + 2q^2 . The market demand function for products is Q = 1,020 − P, where P is the market price.

(a) Below, graph the firm’s short-run supply curve and provide a brief explanation.

q*=____ Q*=____ P*=______. N*=______

(b) What is the long-run equilibrium firm quantity (q), market quantity (Q), price, and number of firms (N)?

q*=____ Q*=____ P*=______. N*=______

(c) Suppose that the market for products is actually controlled by a monopoly. Find the equilibrium price and quantity in the market. What will monopoly profits be?

Q*=____. P*=_____. Profit=______

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Expert Solution

Rahul Sunny answered 6 months ago

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