Suppose that a perfectly competitive firm's fixed cost is 100 and all of this fixed cost is a sunk cost. Its average variable cost is 3q/2. Suppose also that the firm's optimum output is 30 and the market demand is Q=2490-P. Find the number of firms operating in the short run.

Suppose that a perfectly competitive firm's fixed cost is 100 and all of this fixed cost is a sunk cost. Its average variable cost is 3q/2. Suppose also that the firm's optimum output is 30 and the market demand is Q=2490-P. Find the number of firms operating in the short run.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter7: Economies Of Scale And Scope

Section: Chapter Questions

Problem 2MC

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