Suppose that there are 10 identical firms in a perfectly competitive market. Each firm has a total cost function of TC = 560 + 0.25q2, where q is a firm’s output. The market demand function is QD = 480 – 4P, where P is the price per unit of output and QD is total market demand a) Derive the market direct supply equation (QS = f(P)) b) Calculate the short run equilibrium market price (P*) and total quantity (Q*) in the market c) Determine the profit-maximizing quantity (q*) that each firm would produce
Suppose that there are 10 identical firms in a
a) Derive the market direct supply equation (QS = f(P))
b) Calculate the short run
c) Determine the profit-maximizing quantity (q*) that each firm would produce
d) Determine the profit, the
Answer all the four sub-parts
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 2 images
