Problem

\fIn long-run equilibrium in the parcel delivery market what will be the price per delivery? What number of deliveries per day will Penelope's firm make? Explain how you arrived at this result. [Hint: Think about the requirements on the firm in order for long-run equilibrium to exist.] c) (3 marks) Suppose all other firms in the parcel delivery industry are identical to Penelope's Firm. In long-run equilibrium, how many firms will operate in the industry? d) (4 marks) Suppose that market demand changes to: Price 15 20 25 30 35 Qty 180 160 demanded 140 120 100 In the short-run what will be the effect on: i) Price; ii) Market quantity traded; iii) Number of firms; and iv) Quantity of output produced by each firm. Explain your answers