The market for Wedding Cakes can be described by the (inverse) demand curve of

P=60-2Q

And a supply curve of

P=(¹/₂)Q

12)Find the equilibrium price and quantity in the wedding cake market.

13) Find the equilibrium consumer surplus and short run producer surplus in the wedding cake market

Shindigza, one of the firms in the perfectly competitive wedding cake market faces a fixed cost of (FC=) $48 and a variable cost of (VC=) (³/₄)Q². With a corresponding marginal cost of (MC=) (³/₂)Q.

14) Find the quantity and cost at the lowest point of the average total cost curve (minimum efficient scale) for Shindigza.

15) How many firms are in the wedding cake business in the long run?

Consider that Shindigza has a monopoly in the wedding cake business.Assume that Shindigza has constant returns to scale.

16) Find the equilibrium price and quantity in the long run monopoly wedding cake market.

17) Find the consumer surplus, profit, and any long run deadweight loss to welfare in the monopoly market.