There are 300 purely competitive farms in the local dairy market. Of the 300 dairy farms, 298 have a cost structure that generates profits of $21 for every $300 invested.

There are 300 purely competitive farms in the local dairy market. Ofthe 300 dairy farms, 298 have a cost structure that generates prots of $21 for every $300 invested. Instructions: Enter your answers as a whole number. a. What is the percentage rate of return for these 298 dairies? 7 percent b. The other two dairies have a cost structure that generates prots of $24 for every $200 invested. What is their percentage rate of return? 12 percent c. Assuming that the normal rate of profit in the economy is 9 percent, and that firms cannot copy each other's technology, will there be entry or exit? Exit v d. Will the change in the number ofrms affect the two that earn $24 for every $200 invested? O No, because those two rms are too small. 0 Yes, because those exiting rms will spread their technology. 0 No, because the exiting rms didn't belong in the industry. 0 Yes, because those two firms can claim a larger market share. e. What wii be the rate of return earned by most firms in the industry in long-run equilibrium? percent f. If firms can copy each other's technology, what will be the rate of return eventually earned by all firms? percent