1.Firm Z is a perfectly competitive firm that produces good X. Firm Z has a short-run marginal cost given by SMC =0.5 q +10. If there are 50 identical firms in the market and the market demand is given by Q= 9500-50 P

2.What is the equilibrium price and quantity in this perfectly-competitive market? Support your answers with calculations.

3.Is equilibrium in a perfectly-competitive market efficient? Explain why or why not.

4.If the government imposes a tax of $5 per unit on the consumption of . How would this tax change the equilibrium price and quantity? Support your answers with calculations.

5.Will the equilibrium remain efficient after imposing the tax? Explain why or why not.