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A good is represented by a market demand curve Q = 100 P. In this market, there are an unlimited number of potential firms whose

A good is represented by a market demand curve Q = 100 P. In this market, there are an

unlimited number of potential firms whose cost curve is given as TC = Q + Q2.

a) What is the long run equilibrium price, assuming free entry of firms?

(8 marks)

b) How many firms will there be?

(2 marks)

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