An industry consists of 100 firms ("type A") with marginal cost of $10 and 100 with marginal cost of $20 ("type B"). There are no fixed costs and no more than 100 firms with $10 marginal cost can possibly exist. Explain why the equillibrium price in this market will not be $15. What will it be ? Explain

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The equilibrium price in this market will not be 15 because at that price one of the two types of fi... View the full answer