Microeconomics

PROBLEM (2) 500 almond growers operate in areas with plenty of rainfall (type 1 firms) and 300 operate in drier areas (type 2 firms). The marginal cost of growing almonds for each type of firm is MCI(Q) = 0.02 Q and MC2(Q)= 0.04 Q, respectively, in the short run. Assume that the shut-down price is 0. (a) Finding the individual supply for each type of firm, derive the short run market supply. (b) If Market demand for almonds is given by the equation QMarket = 105,000- 2,500P what will be the short run equilibrium price and quantity of almonds? (c) How many almonds will each type of grower produce, in equilibrium