Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Suppose a representative firm in a perfectly competitive, constant-cost industry has a cost function TC = 2Q2 98Q 98. Instructions: Round your answers to the
Suppose a representative firm in a perfectly competitive, constant-cost industry has a cost function TC = 2Q2 98Q 98. Instructions: Round your answers to the nearest whole number. a. What is the long-run equilibrium price for this industry? $ b. If market demand is given by the function Q = 980 P, where P denotes price, how many firms will operate in this long-run equilibrium? firms c. Suppose the government grants a lump-sum subsidy to each firm that manufactures the product. If this lump-sum subsidy equals 36, what would be the new long-run equilibrium price for the industry? $
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started