Question
A firm in a competitive industry has the following short-run cost function: c(y) = y/3 - 15y +210y. Assume that all firms in the
A firm in a competitive industry has the following short-run cost function: c(y) = y/3 - 15y +210y. Assume that all firms in the industry have the same cost function. If industry demand is D(p) = 800 - P, how many firms will exist in equilibrium (no entry, no exit)? Hint: find optimal output for single firm and corresponding price. Then use that price to determine industry output. Then figure out how many firms are needed to generate that level of industry output. Round to nearest integer.
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Microeconomics An Intuitive Approach with Calculus
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