Demand for output in the market is : Q^d = 250-(1/2)P,

and supply Q^s = (1/2)P - 10.

Total cost for an individual firm in the industry is C(q) = 100 + 10q + 4q² so that MC=10+8q

If the industry is perfectly competitive, what level of output maximizes profit for a individual firm in the industry?

1. Provide a graph of marginal revenue and marginal cost

2. What level of profit does each firm earn? How do you expect this profit and the number of firms to be affected in the long run, if at all? Explain

3. If the industry is instead controlled by a monopoly, what quantity and price will maximize profit for the firm? provide a graph of demand, marginal revenue, and marginal cost.