Consider a monopolistically competitive firm whose cost is given by C = 2 + 2Q + Q
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Question:
Consider a monopolistically competitive firm whose cost is given by C = 2 + 2Q + Q2, and its demand function is given by
Q =32 - 4P.
(1) Find the optimal price and quantity of output in the short run.
(2) What long-run adjustments should you expect?Explain.
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