(d) Calculate the profit or loss of each firm at the short-run market equilibrium. If they are making losses, why are they still producing in the short run? In the long run, will there be entry into the market or exit from it? (e) What would the price be in the long run equilibrium, assuming constant cost industry? (f) In the long run equilibrium, how many shirts would each firm produce? What would be a firm’s net profit? (g) How many firms would be operating in the market in the long run equilibrium?
PROBLEM (4) The short run market supply for shirts is QS = 50P – 1000 and the market demand is
QD = 2800 – 50P Let a typical firm operating in a
(a) Determine the short run
(b) Determine how much the typical firm will produce at the equilibrium price you found in (a).
(c) If all firms had the same cost structure, how many firms should be operating in this industry at the moment?
(d) Calculate the profit or loss of each firm at the short-run market equilibrium. If they are making losses, why are they still producing in the short run? In the long run, will there be entry into the market or exit from it?
(e) What would the price be in the long run equilibrium, assuming constant cost industry?
(f) In the long run equilibrium, how many shirts would each firm produce? What would be a firm’s net profit?
(g) How many firms would be operating in the market in the long run equilibrium?
PLEASE ANSWER THE PARTS: d,e,f,g !!
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