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1. Suppose inverse demand is linear: P(Q) = A bQ. The constant average (and marginal cost) of production for all firms is c. (a) Derive
1. Suppose inverse demand is linear: P(Q) = A bQ. The constant average (and marginal cost) of production for all firms is c.
(a) Derive the elasticity of demand.
(b) Derive the monopoly price and quantity as a function of the parameters of the model.
(c) Derive the competitive price and quantity as a function of the parameters of the model.
please show all calculations for the elasticity I got
e = (bq-a)/(bq)
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