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Hi please help me with these two questions. In a country called Cocoland, the market for chocolate is regarded as perfectly competitive. In addition, consumers
Hi please help me with these two questions.
In a country called Cocoland, the market for chocolate is regarded as perfectly competitive. In addition, consumers Cocoland perceive chocolate and ice cream as perfect substitutes.
(a) Using diagrams, illustrate the initial long run equilibrium of a firm producing chocolate.
(b) The supply of ice cream has expanded recently due to the adoption of better technology by ice cream makers. Explain, using diagrams, how does this affect the market for chocolate and its producers in the short run and long run.
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