Suppose a representative firm in a perfectly competitive industry has the following total cost of production in the short run: TC = Q^3 - 10Q^2 + 100Q . 5. What will be the long run equilibrium price for the firm? a) 10 b) 55 c) 75 d) 95 e) None of above 6. If the industry demand is given by QD = 600 - P, how many firms will be active in the long-run equilibrium? a) 100 b) 105 c) 110 d) 115 e) None of above
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In the long-run equilibrium, the price will be equal to the minimum average total cost (ATC) of production for the representative firm. To find the minimum ATC, we need to find the level of output (Q) that minimizes the average total cost. The average total cost Show more…
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