Consider the perfectly competitive market for copper. Assume that, regardless of how many firms are in the industry, every firm in the industry isidentical and faces the marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves shown on the following graph.COSTS (Dollars per pound)80726456322416800+4мс пMCATCAVC☐■8 12 16 20 24 28QUANTITY (Thousands of pounds)32☐3640? Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 10 firms in the market. (Hint: You candisregard the portion of the supply curve that corresponds to prices where there is no output, since this is the industry supply curve.) Next, use thepurple points (diamond symbol) to plot the short-run industry supply curve when there are 20 firms. Finally, use the green points (triangle symbol) toplot the short-run industry supply curve when there are 30 firms.PRICE (Dollars per pound)8072645648403224168Cả0 +0Demand120 240 360 480 600 720 840 960 1080 1200QUANTITY (Thousands of pounds)Supply (10 firms)Supply (20 firms)Supply (30 firms)If there were 20 firms in this market, the short-run equilibrium price of copper would be $would. Therefore, in the long run, firms would?per pound. At that price, firms in this industrythe copper market.Because you know that perfectly competitive firms earnbe $▾ economic profit in the long run, you know the long-run equilibrium price mustper pound. From the graph, you can see that this means there will be firms operating in the copper industry in long-runequilibrium.

Supply Curve is the curve that conveyed the different levels of quantity that a producer is willing…

Consider the perfectly competitive market for copper. Assume that, regardless of how many firms are in the industry, every firm in the industry is dentical and faces the marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves shown on the following graph. COSTS (Dollars per pound) 80 72 64 56 48 40 32 24 16 8 0 0 4 MC 8 12 16 20 QUANTITY ATL 24 ATC AVC 28 32 HY ■ 36 4 40 ?

Consider the perfectly competitive market for copper. Assume that, regardless of how many firms are in the industry, every firm in the industry is dentical and faces the marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves shown on the following graph. COSTS (Dollars per pound) 80 72 64 56 48 40 32 24 16 8 0 0 4 MC 8 12 16 20 QUANTITY ATL 24 ATC AVC 28 32 HY ■ 36 4 40 ?

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter21: Production And Costs

Section: Chapter Questions

Problem 16QP

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