Consider a perfectly competitive industry, where the current equilibrium price is p*=16 and the current equilibrium market output is Q*=600. Quantity is measured in tons. If each firm has a marginal cost of 4q and an average cost of 2q+5/q. How many firms are in this market? Is this a short-run or a long-run equilibrium? A. 100 firms and it is a short-run equilibrium. B. 200 and it is a short-run equilibrium. C. 150 firms and it is a short-run equilibrium. D. 150 firms and it is a long-run equilibrium. E. none of the above

Consider a perfectly competitive industry, where the current equilibrium price is p=16 and the current equilibrium market output is Q=600. Quantity is measured in tons. If each firm has a marginal cost of 4q and an average cost of 2q+5/q. How many firms are in this market? Is this a short-run or a long-run equilibrium? A. 100 firms and it is a short-run equilibrium. B. 200 and it is a short-run equilibrium. C. 150 firms and it is a short-run equilibrium. D. 150 firms and it is a long-run equilibrium. E. none of the above

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter26: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 5E

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