Each of 1000 identical firms in the competitive peanut butter industry has a short- run marginal cost

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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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Microeconomics and Behavior

ISBN: 978-0078021695

9th edition

Authors: Robert Frank

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Question Posted: Dec 12, 2014 10:22 AM

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Each of 1000 identical firms in the competitive peanut butter industry has a short- run marginal cost

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