Consider a market of five (5) firms that produce the same thing. Market demand is P = 230 - Q and the marginal cost of production is $20. If firms compete through production, what will be the expected MARKET quantity and MARKET price?

1. Q = 35, P = $55
2. Q = 175, P = $55
3. Q = 35, P = $195
4. Q = 175, P = $20

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Consider the market from the previous question. If each firm had fixed costs of $1,500, would the market still be able to support five firms?

A) Yes, because economic profit would still be positive after fixed costs are considered.

B) Yes, because fixed costs do not matter when firms decide to stay in business.

C) No, because fixed costs would force firms to set prices that are too high for consumers.

D) No, because economic profit would be negative after fixed costs are considered.