The market for Knitted Blankets is categorized by the following Supply and Demand Functions.

(Note: The market supply contains ALL perfectly competitive suppliers in the market for knitted blankets).

Demand: Q=1280-12P

and

Supply:400+8P

a.What is the Equilibrium Price in the Market?

b.What is the Total Revenue Function for the individual firms (e.g. Emily's Elite Blankets) in this Perfectly Competitive Industry?

c.Using the Equilibrium Price and Total Revenue function you found in part a/b, and the following TOTAL COST curve facing Emily's Elite Blankets (a representative perfectly competitive firm), solve for Emily's Profit Maximizing level of output (Q) AND the Total Profit that she earns.

TC=Q^2+375

d.Is this economy in long run equilibrium? How do we know?