Graph 14-7 In this graph, panel (a) depicts the linear marginal cost of a firm in a competitive market, and panel (b) depicts the linear market supply curve for a market with a fixed number of identical firms.Use the graph to answer the following question(s).
-Refer to Graph 14-7.If at a market price of $1.50, 18 750 units of output are supplied to this market, how many identical firms are participating in this market?

Question

Graph 14-7  In this graph, panel (a) depicts the linear marginal cost of a firm in a competitive market, and panel (b) depicts the linear market supply curve for a market with a fixed number of identical firms.Use the graph to answer the following question(s).
-Refer to Graph 14-7.If at a market price of $1.50, 18 750 units of output are supplied to this market, how many identical firms are participating in this market?

Quizplus · Accepted Answer

At a market price of $1.50, each firm supplies 150 units of output (as seen from the supply curve). Therefore, if 18,750 units are supplied in total, the number of firms = 18,750 units / 150 units per firm = 125 firms.

Graph 14-7 in This Graph, Panel (A) Depicts the Linear