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Assume that the production of widgets is a perfectly competitive industry. The market demand for widgets is described by the following demand function: QD =

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Assume that the production of widgets is a perfectly competitive industry. The market demand for widgets is described by the following demand function: QD = 125-5P There are 50 manufacturers of widgets in the market. Each manufacturer has the same production costs, given by TC(q) =q-+q MC = 2g +1 AVC = ATC = q+1 Find the market price in equilibrium. (Hint: First. find the firm's supply curve. Then find the industry supply curve and lastly, calculate the market equilibrium.)

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