Market demand is given as Q_D= 120 - 2P.Market supply is given as Q_S= 2P.Each identical firm has MC = 6Q and ATC = 3Q.What quantity of output will a typical firm produce

Question

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To find the quantity a typical firm will produce, we need to find the equilibrium price first. Set QD = QS: 120 - 2P = 2P, solving gives P = 30. At P = 30, QS = 2(30) = 60. Each firm produces where MC = P, so 6Q = 30, solving gives Q = 5.

Market Demand Is Given as QD = 120 - 2P

Market Demand Is Given as Q_D= 120 - 2P