7. There are many identical firms with a simple cost structure: Total cost for Q = 0...

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7. There are many identical firms with a simple cost structure: Total cost for Q = 0 is $6 and total cost for Q = 1 is $8. Each firm is incapable of producing anything more; in other words, total cost is infinite for any Q larger than 1.

a. What is the fixed cost? What is the marginal cost of the first unit?

b. In the short run, above what price will firms supply one unit each?

c. If firms are free to enter and exit this market, what will be the long-run price?

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Microeconomics

ISBN: 9781292214351

2nd Global Edition

Authors: Daron Acemoglu, David Laibson, John List

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Question Posted: Nov 18, 2024 06:00 AM

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7. There are many identical firms with a simple cost structure: Total cost for Q = 0...

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Microeconomics

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