Please consider this original scenario to assist in resolving problem PS5.4.7..Despondent over the Red Sox's terrible season, Prof. Gruber decides to quit his day job and start a bicycle manufacturing firm in Kendall Square. As he starts looking into the bicycle manufacturing industry, he realizes it has some interesting features. First, he realizes that it operates as a competitive industry. Second, he finds that there are two technologies used by firms in the industry. Technology 1 uses solar power, and has a cost functionc1(q) = q + 4q^2 + 32 for q>0. Technology 2 uses electricity from the grid and is more efficient, with a cost functionC^2(q) = q +2q^2 _32 for q>0. Assume that we are in the long run, so firms using both technologies can shut and leave the market at 0 cost, so thatC(0) = 0 for both technologies.

3/3 points (graded) The long run price, now that there are 10 bicycle manufacture using technology 1, will remain at p* = 17. There is still free entry for firms using technology 2. What quantity will be produced by each firm using technology 1? 2 What quantity will be produced by each firm using technology 2? 4 4 In equilibrium, how many firms using technology 2 will there be in the market? N2 = 30 30 Submit You have used 1 of 2 attempts Save Show answer Problem PS5.4.7 2 points possible (graded) In equilibrium, how much profit will each technology 1 firm make? In equilibrium, how much profit will each technology 2 firm make? 72 =