In a perfectly competitive market there are 20 active firms producing a divisible good. The total cost function of each firm is C(Q) = Q2+4Q: There are no fixed costs. The demand is QD(P) = 805P

(a) Compute the average and marginal costs for each firm and give a graphical representation.

(b) Compute the short run supply function of a single firm and give a graphical representation in the same plot.

(c) Compute the aggregate supply function in the short run and determine the market equilibrium.

(d) Compute the total surplus, and its subdivision in consumers' and producers' surplus. Give a graphical representation.

(e) Compute the long run market equilibrium, how many firms are active? (f) Imagine now that due to governmental restriction each firm can produce maximum one unit of the good find the new equilibrium and the deadweight loss