Carolina Holiday sells an outdoor lighting package to customers across the Charlotte Metro. Carolina's monthly demand and cost information are as follows:

P= 800- 2Q

TC=20,000 +200Q

The cost function includes a normal return, so any profit could be considered an economic profit. The structure of the market is monopolistic competition.

A. What are the firm's current price/output combination and profit level. Is the market in equilibrium, include a brief explanation for your answer.

B. Calculate the equilibrium price and quantity and demonstrate that this is indeed a long run

equilibrium.