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At its current level of production, a firm in a perfectly competitive market faces a marginal cost of $8 and an average cost of $8.
At its current level of production, a firm in a perfectly competitive market faces a marginal cost of $8 and an average cost of $8. What is the current market price? What will this firm do in the short run and what will it do in the long run? If all firms in the market are identical, will there be entry or exit? What will the long-run market price be?
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