Question: 4. Let us continue with the electric car example from Problem 3. Suppose the market for electric cars is competitive. a. Show that the equilibrium

4. Let us continue with the electric car example from Problem 3. Suppose the market for electric cars is competitive.

a. Show that the equilibrium price in this market is $40,000.

b. Which firms will produce an electric car if the price is $40,000?

c. Which consumers will buy an electric car when the price is $40,000?

d. Calculate consumer surplus, producer surplus, and social surplus when the price is $40,000.

e. Compare your answers to those for Problem 3.

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