A perfectly competitive industry has 70 identical firms in the short run, each of which has the short-run cost curves listed in the following table.

Output

Average total cost

Average variable cost

Marginal

11

20.5

13.1

12

12

19.8

13

14

13

19.3

13.1

16

14

19.1

13.3

18

15

19

13.6

20

16

19.1

14

22

17

19.2

14.5

24

18

19.5

15

26

19

19.8

15.6

28

20

20.3

16.2

30

21

20.7

16.9

The industry demand is given in the next table

Price

Quantity demanded

11

3200

13

3000

15

2800

17

2600

19

2400

21

2200

23

2000

25

1800

27

1600

29

1400

31

1200

a)What is the shutdown point? What is the break-even point?

b)What amount of profit (or loss) is being made by each firm at the short-run equilibrium? Is this industry in long-run equilibrium at its present size?

c)What is the optimal number of firms in the long-run?