Not use ai please 2. Consider a perfectly competitive market at a long-run equilibrium. The industry has 100 firmsthat sell 100 units each at a price of $20.(a) Illustrate both the entire market (supply/demand diagram) and the individual firm(cost/revenue diagram) at long-run equilibrium.(b) Suppose a decrease in consumer demand occurs, which reduces the total quantity soldon the market by 1000 units. Illustrate the effect this decrease in demand would have onboth the market and the individual firm, showing also the response of supply.(c) Suppose the market now supplies 3000 units. How many firms exited the market?

(b) Effect of Demand Decrease:Market diagram shows:Demand curve shifts left (dashed line)New…

Answered: 2. Consider a perfectly competitive…

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter13: Firms In Competitive Markets

Section: Chapter Questions

Problem 5PA

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Looking to see how to resolve
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1.0 - If the demand forApple Cinnamon Cheerios decreases at all prices, what will happen to thedemand curve? Show the shift in the demand curve on the same diagram and explain what happensto the firm’s output and profits.

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