3 1 Consider a perfectcompetition scenario, where the market demand is given by P = 100 5Q, market supply is given by P = 5Q. Suppose on the rm level, the rm's marginal costs are given by MC = 5G, and average total costs are given by ATC = 2.5Q+ 63. What is the market output and corresponding price? 0 (1:200 , P=SU O Q=2U0, P=200 0:200, P=25 0 (1:25, P=200 QUESTION 8 3 1 Consider a perfectcompetition scenario, where the market demand Is given by P = 100 5Q, market supply Is given by P = Q. Suppose on the rm level, the rm's marginal costs are given by 8 MC = 5G, and average total costs are given by ATC = 2.5Q+ 63. How much will the individual rm choose to produce, and what will be their prot? 0 Q25, Prot: $2.5 O Q=5U, Prot= $25 0 (1:50, Prot $25 6) (1:5, Prot= $2.5 QUESTION 9 3 1 Consider a perfectcompetition scenario, where the market demand is given by P = 100 EQ, market supply is given by P 2 Q7 Suppose on the rm level, the rm's marginal costs are given by B 65 MC = 5Q, and average total costs are given by ATC = 2.5Q+ 6. Given your answer to the last question, what is the best long term prediction for how the market will adjust? 0 Firms will enter the market, and eventually make a long run prot. Firms will leave the market, driving the prots to zero. 0 Firms will enter the market, driving prots to zero