If there were 30 firms in this market, the short-run equilibrium price of rhenium would be $______ per pound. At that price, firms in this industry would ______. Therefore, in the long run, firms would _______ the rhenium market.Because you know that competitive firms earn ______ economic profit in the long run, you know the long-run equilibrium price must be $_____ per pound. From the graph, you can see that this means there will be ___ firms operating in the rhenium industry in long-run equilibrium. True or False: Assuming implicit costs are positive, each of the firms operating in this industry in the long run earns negative accounting profit. 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)807264564840322416800Demand120 240 360 480 600 720 840 960 1080 1200QUANTITY (Thousands of pounds)Supply (10 firms)Supply (20 firms)Supply (30 firms) Consider the competitive market for rhenium. Assume that no matter how many firms operate in the industry, every firm is identical and faces thesame marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves plotted in the following graph.COSTS (Dollars per pound)8072645648403224168003MCATC6AVC□9 12 15 18 21QUANTITY (Thousands of pounds)242730(?)

A perfectly competitive market is a theoretical market formation where all companies offer identical…

Answered: If there were 30 firms in this market,…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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If there were 30 firms in this market, the short-run equilibrium price of rhenium would be $______ per pound. At that price, firms in this industry would ______. Therefore, in the long run, firms would _______ the rhenium market.

Because you know that competitive firms earn ______ economic profit in the long run, you know the long-run equilibrium price must be $_____ per pound. From the graph, you can see that this means there will be ___ firms operating in the rhenium industry in long-run equilibrium.

True or False: Assuming implicit costs are positive, each of the firms operating in this industry in the long run earns negative accounting profit.

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 can
disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the
purple points (diamond symbol) to plot the short-run industry supply curve when there are 20 firms. Finally, use the green points (triangle symbol) to
plot the short-run industry supply curve when there are 30 firms.
PRICE (Dollars per pound)
80
72
64
56
48
40
32
24
16
8
0
0
Demand
120 240 360 480 600 720 840 960 1080 1200
QUANTITY (Thousands of pounds)
Supply (10 firms)
Supply (20 firms)
Supply (30 firms)

Consider the competitive market for rhenium. Assume that no matter how many firms operate in the industry, every firm is identical and faces the
same marginal cost (MC), average total cost (ATC), and average variable cost (AVC) curves plotted in the following graph.
COSTS (Dollars per pound)
80
72
64
56
48
40
32
24
16
8
0
0
3
MC
ATC
6
AVC
□
9 12 15 18 21
QUANTITY (Thousands of pounds)
24
27
30
(?)

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