Question

Suppose that marginal cost and average total cost for the typical firm in the industry are depicted below: -- - ------ --- 100 110 120 130 140 150 160 170

A) What is the short-run equilibrium price?

B) How much output each firm produce in the short-run?

C) In the short-run, how much profit does each firm earn?

D) In the long-run, what do you expect to happen?

E) What is the long-run equilibrium price?

F) What is the long-run profit per firm?

G) In the long-run, how many firms will be in the industry?

Answer 1

In sharteen, DD=55 shartreun eq peid=2.50 b) each firin produces $150 c) Profit = (.50 2100=75 In loy leen, other new foins will enter. In long ellen, Pure = mir of Al. mus P = $1.75 8) log peft=0 9 no. of firis a 52006 400 forms U eneri 130 =