Help 2. The widget market is characterized by perfect competition. The "inverse" market demand is P = 30 – 0.05Q,while the market supply is Q =-100+20P. The firms are identical, and the cost structure of a typical firm is TC;= 200 + 5Q; + 0.5Q², with MC; = 5 + Qia) How many (identical) firms are there currently in the market?b) Derive the competitive equilibrium for the market.c) Solve for the optimal output level for a typical firm.

a typical firm in a competitive market produces output where P= MC. for given P=MC derived relation…

2. The widget market is characterized by perfect competition. The "inverse" market demand is P = 30 – 0.05Q, while the market supply is Q=-100+20P. The firms are identical, and the cost structure of a typical firm is TC; = 200 + 5Qi+ 0.5Q², with MC; = 5 + Qi a) How many (identical) firms are there currently in the market? b) Derive the competitive equilibrium for the market. c) Solve for the optimal output level for a typical firm.

2. The widget market is characterized by perfect competition. The "inverse" market demand is P = 30 – 0.05Q, while the market supply is Q=-100+20P. The firms are identical, and the cost structure of a typical firm is TC; = 200 + 5Qi+ 0.5Q², with MC; = 5 + Qi a) How many (identical) firms are there currently in the market? b) Derive the competitive equilibrium for the market. c) Solve for the optimal output level for a typical firm.

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 1CQQ

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