Question: Figure 4 Panel ( a ) represents an individual firm's cost curves in a perfectly competitive market, and panel ( b ) represents the market

Figure 4
Panel (a) represents an individual firm's cost curves in a perfectly competitive market, and panel (b) represents the market conditions (thus, short-run and long-run responses of the perfectly competitive market.)
(a)
(b)
Refer to Figure 4. Assume that the market starts in equilibrium at point A in panel (b) in a perfectly competitive market. Panel (a) represents cost curves of an individual firm in this competitive market. An increase in demand from Demando t Demand ?1 will increase the price from P1 to P2, causing economic profit for an existing firm in the short run. This will cause new q, of firms and eventually q, the number of firms in the market, shifting supply curve from Supply oto Supply ?1, and reach a new long-run equilibrium at point q,(choose one among A, B, C, and D)
Provide multiple answers with commas q,,,
Figure 4 Panel ( a ) represents an individual

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