Consider a competitive industry with a large number of firms, all of which have identical cost functions
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(a) What is the supply curve of an individual firm? S(p) = ________. If there are n firms in the industry, what will be the industry supply curve? ________.
(b) What is the smallest price at which the product can be sold? ________.
(c) What will be the equilibrium number of firms in the industry)
(d) What will be the equilibrium price? ________. What will be the equilibrium output of each firm? ________.
(e) What will be the equilibrium output of the industry? ________.
(f) Now suppose that the demand curve shifts to D(p) = 52.5 − p. What will be the equilibrium number of firms?
(g) What will be the equilibrium price? Solve 52.5 − p = ________. What will be the equilibrium output of each firm? ________. What will be the equilibrium profits of each firm? ________.
(h) Now suppose that the demand curve shifts to D(p) = 53−p. What will be the equilibrium number of firms? ________. What will be the equilibrium price? ________.
(i) What will be the equilibrium output of each firm? ________. What will be the equilibrium profits of each firm? ________.
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