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Im having difficulty approaching this answer, any help would be appreciated: thank you! . ._QD=1o,ooo$-p . . . 10. Demand for XRay machines Is. 2

Im having difficulty approaching this answer, any help would be appreciated: thank you!

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. ._QD=1o,ooo$-p . . . 10. Demand for XRay machines Is. 2 (p: price In $ per machine) X-Ray machines are produced by identical, \"price-taking" rms (individually denoted by 0, each with the following costs for producing Q, units: Total Cost: TC(Q,) = Q? + 1, 000, 000 Marginal Cost: MC(Q,-) = ZQi (a) Derive the Average Total Cost (ATC) for rm i. At what level of Q1 is the ATC minimized and what is the minimum value of ATC? (b) On a graph with rm output Qi on the horizontal axis and unit cost (in $) on the vertical axis, sketch the MC and ATC curves. Label the intercept and s|_op_e of the MC curve and the coordinates of the minimum point of the ATC curve. [Note: Outside of the minimum point, you can sketch the ATC curve freely. ] (c) The current market price per X-Ray machine is p=4,000. In the short-run, the number of firms is xed. How many X-Ray machines will each m produce? What will be each firm's profit? Calculate and show both the production level and individual rm prot on the graph from (b) (d) In the short-run, how many producers n are serving the market at the equilibrium price of p=4,000? And what is the combined prot of all n rms? (e) Without barriers to entry, what do you expect to be the long-run equilibrium pri_ce of an XRay machine after the number of rms n has adjusted? How many XRay machines will the typical rm produce under the long-run equilibrium? (f) In the long-run equilibrium, how many producers n are serving the market? And what is the combined prot of all n rms? (9) There are many reasons why the market for X-Ray machines may not reach the outcome described in (e) and (f), but remain at a higher equilibrium price even in the long-run. Provide one possible reason and explain it. [No calculations needed, only a brief explanation applied to XRa y machines. ]

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