12.5 Suppose that the demand for stilts is given by Q 1,500 & 50P and that the long-run total operating costs of each stilt-making

12.5 Suppose that the demand for stilts is given by Q ¼ 1,500 & 50P and that the long-run total operating costs of each stilt-making firm in a competitive industry are given by C(q) ¼ 0.5q2 & 10q.

Entrepreneurial talent for stilt making is scarce. The supply curve for entrepreneurs is given by QS ¼ 0.25w, where w is the annual wage paid.