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Unformatted text preview: How much prot does the rm earn? b) In the long run, is there entry or exit from this industry? c) What is the long run equilibrium price of widgets? In long run equilibrium, how many does each rm produce? 5. Every rm in the widget industry has xed costs of $15. The following chart show the industry-wide demand curve and the marginal cost curve of a typical rm: Industry Wide Demand Firms MC Curve Price Quantity $5 750 10 600 15 450 20 300 25 150 Quantity Marginal Cost 1 $5 2 10 3 15 4 20 5 25 Suppose the industry is in long run equilibrium. a) What is the price of a widget? b) How many rms are in the industry? c) On the short-run supply curve, what quantity corresponds to a price of $10?...
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This note was uploaded on 06/09/2008 for the course ECO 108 taught by Professor Landburg during the Fall '06 term at Rochester.
- Fall '06