2 Consider the market for X. Suppose it is competitive. Two types of firms produce X. Type 1 has a MC function given by MC₁ = (Q₁-10)² + 100. Type 2 has a MC function given by MC₂ = (Q₂ - 8)² + 100. Fifty firms of each type exist. a. b. Calculate and draw the short-run supply curve for a typical firm of each type, labeling carefully. (Hint: you may decide that integrating one or both of the above functions is helpful. If so, you'll be less likely to make an error if you write them out as quadratic equations.) Calculate and draw the INDUSTRY short-run supply curve, labeling carefully.
2 Consider the market for X. Suppose it is competitive. Two types of firms produce X. Type 1 has a MC function given by MC₁ = (Q₁-10)² + 100. Type 2 has a MC function given by MC₂ = (Q₂ - 8)² + 100. Fifty firms of each type exist. a. b. Calculate and draw the short-run supply curve for a typical firm of each type, labeling carefully. (Hint: you may decide that integrating one or both of the above functions is helpful. If so, you'll be less likely to make an error if you write them out as quadratic equations.) Calculate and draw the INDUSTRY short-run supply curve, labeling carefully.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:2 Consider the market for X. Suppose it is competitive.
Two types of firms produce X. Type 1 has a MC function
given by MC₁ = (Q₁-10)² + 100. Type 2 has a MC function
given by MC₂ = (Q₂ - 8)² + 100. Fifty firms of each type exist.
a.
b.
Calculate and draw the short-run supply curve for a
typical firm of each type, labeling carefully. (Hint:
you may decide that integrating one or both of the
above functions is helpful. If so, you'll be less likely
to make an error if you write them out as quadratic
equations.)
Calculate and draw the INDUSTRY short-run supply
curve, labeling carefully.
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