If a representative firm with long-run total cost given by TC = 50 + 2q + 2q² operates in a competitive industry where the market demand is given by Q_D = 1,410 - 40P,in the long-run equilibrium there will be:

Question

Quizplus · Accepted Answer

In long-run equilibrium, P = MC = AC. The firm's MC is derived from TC, and setting MC = AC gives the equilibrium price. Solving for the number of firms using market demand and equilibrium price results in 106 firms.

If a Representative Firm with Long-Run Total Cost Given by TC