Assume that all firms in this industry have identical cost curves, and that the market is perfectly competitive. In the long run, there will be ________ firms in this market.
A)10
B)15
C)25
D)50

Question

Assume that all firms in this industry have identical cost curves, and that the market is perfectly competitive.  In the long run, there will be ________ firms in this market.
A)10 
B)15 
C)25 
D)50

Quizplus · Accepted Answer

The long-run equilibrium price is $10. At that price, each firm produces 30 units of output and 300 units of output are produced by the market. Thus, there must be 10 firms in the market.

Assume That All Firms in This Industry Have Identical Cost