Question: Suppose that a competitive firm has a total cost function TC= 100q+10q2. If the market price is P = $7 per unit, find: 1. MC

Suppose that a competitive firm has a total cost function TC= 100q+10q2. If the market price is P = $7 per unit, find:

1. MC and MR and demand function for a competitive firm. Is the demand elastic or inelastic?

2. the level of output produced by the firm in order to maximize its profit.Explain.

2. the level of profit in short run and in long run.Explain.

3.Would you expect to see entry into or exit from the industry in longrun? Explain & support your answer with graphical representations.

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