price per automobile in the new integraled I Suppose that fixed costs for a firm in the automobile industry (start-un ries, capital equipment, and so on) are $2 billion and that variable S15,000 per finished automobile. Because more firmsn market, the market price falls as more firms enter an automobile cally P 15,000 + (500), where n represents the number of firms in Assume that the initial size of the U.S. and the European automobile mark million and 800 million people, respectively a. Calculate the equilibrium number of firms in the U.S. and European conts of f costs are e mpeti market, or markets without trade. b. What is the equilibrium price of automobiles in the United States and automobile industry is closed to foreign trade? e. Now suppose that the United States decides on free trade in aut Europe. The trade agreement with the Europeans adds 800 millio the automobile market, in addition to the 500 million in the Uni many automobile firms will there be in the United States and in E What will be the new equilibrium price of automobiles? d. Why are prices in the United States different in (c) than in (b)? ter off with free trade? In what ways? dunte that are traded on internationa price per automobile in the new integraled I Suppose that fixed costs for a firm in the automobile industry (start-un ries, capital equipment, and so on) are $2 billion and that variable S15,000 per finished automobile. Because more firmsn market, the market price falls as more firms enter an automobile cally P 15,000 + (500), where n represents the number of firms in Assume that the initial size of the U.S. and the European automobile mark million and 800 million people, respectively a. Calculate the equilibrium number of firms in the U.S. and European conts of f costs are e mpeti market, or markets without trade. b. What is the equilibrium price of automobiles in the United States and automobile industry is closed to foreign trade? e. Now suppose that the United States decides on free trade in aut Europe. The trade agreement with the Europeans adds 800 millio the automobile market, in addition to the 500 million in the Uni many automobile firms will there be in the United States and in E What will be the new equilibrium price of automobiles? d. Why are prices in the United States different in (c) than in (b)? ter off with free trade? In what ways? dunte that are traded on internationa