The next 5 questions relate to the following scenario: In a perfectly competitiv

Question

The next 5 questions relate to the following scenario: In a perfectly competitive market, market demand is O 380-2P and market supply is OP 20. Each firm has short-run MC= 5Q and ATC = 2.5Q +0000) (ATC is at minimum when Q = 6.32). How much output will each firm produce? a. 180 b. 10 4. d. 100 5. What is the profit/loss for each firm in the short-run? a. $-7. 000 b. $900 c. $2, 500 d. $0 How many firms are there in the industry in the short-run? a. 12 b. 5 c. 9 d. 20 6. What will the price be in long-run equilibrium? a. $31.62 b. $10 c. $6.32 d. $48.85 7. How many firms will there be in long-run equilibrium? a. 50.12 b. 28.89 c. 107.27 d. 180 8. n average-total-cost curves often Why are long-ru a. because of the same reasons that averan 9. are often U-shaped of production and increasing sine coordi

Explanation / Answer

In equilibrium, Qd = Qs

380-2P =2P-20

4P=400

P =100

So the price in long run equilibrium is $100

So the correct Answer is:- 100

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