In Problem, suppose the city imposes an excise subsidy of $3 per widget. (That is, widget manufacturers receive $3 from the government for each widget they produce.)

a. In the short run, what is the new price of a widget?
b. In the long run, what is the new price of a widget?
c. In the long run, how many firms enter theindustry?

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Industry-Wide Demand Price Firm's Marginal Cost Curve Quantity Quantity 500 400 300 200 100 50 25 10 Marginal Cost $2 $2 12 12 15 15