(1) The market demand function for a good is given by Q = D(p) = 800-50p. For each firm that produces the good the total cost function is TC(Q) =

(1) The market demand function for a good is given by Q = D(p) = 800-50p. For each
firm that produces the good the total cost function is TC(Q) = 10+ . Recall that
this means that the marginal cost is MC(@) = 4 + Q. Assume that firms are price
takers.
(a) is the efficient scale of production and the minimum of average cost for
each firm?
nt: Graph the average cost curve first.
(b) is the supply function of each firm?
(c) If there are currently 100 firms producing the good, what is the market supply
function? is the short-run competitive equilibrium in this market with
100 firms? is the profit of each firm?
(d) is the long-run competitive equilibrium price and quantity in this market?

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