PROBLEM (8) In a monopolistically competitive market with N firms, each firm faces a demand 100 Q = N p and has costs TC (Q) = 50 + Q² (a) As a function of the number of firms N, how many units does each firm produce and what price does it charge? What is the net profit of each firm? (b) In the long run how many firms will populate this market?

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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PROBLEM (8) In a monopolistically competitive market with N firms, each firm faces a demand
100
Q =
p and has costs TC (Q) = 50 + Q?
%3D
(a) As a function of the number of firms N, how many units does each firm produce and what price does it charge?
What is the net profit of each firm?
(b) In the long run how many firms will populate this market?
Transcribed Image Text:PROBLEM (8) In a monopolistically competitive market with N firms, each firm faces a demand 100 Q = p and has costs TC (Q) = 50 + Q? %3D (a) As a function of the number of firms N, how many units does each firm produce and what price does it charge? What is the net profit of each firm? (b) In the long run how many firms will populate this market?
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