Question

Each of 1000 identical firms in the competitive peanut butter industry has a short- run marginal cost curve given by
SMC = 4 + Q
If the demand curve for this industry is
P = 10 - 2Q/1000
What will be the short- run loss in producer and consumer surplus if an outbreak of aflatoxin suddenly makes it impossible to produce any peanut butter?



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  • CreatedDecember 12, 2014
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