# Question

Suppose there are n identical firms in a market. Each firm has fixed cost equal to 392, and variable cost given by VC = 2q2, where q is the amount that an individual firm produces. This means that an individual firm’s marginal cost is given by MC = 4q. Also, the market demand is given by. P = 1148 – 3Q, where Q is the total amount of the good produced by all of the firms combined. Therefore, Q = n*q.

(a) How much output will each of them produce?

(b) What will be the market price?

(c) How many firms will there be in long run equilibrium?

(a) How much output will each of them produce?

(b) What will be the market price?

(c) How many firms will there be in long run equilibrium?

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