A perfectly competitive painted necktie industry has a large

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A perfectly competitive painted necktie industry has a large number of potential entrants. Each firm has an identical cost structure such that long-run average cost is minimized at an output of 20 units. The minimum average cost is $10 per unit. Total market demand is given by Q=1500-50P.
a. What is the industry's long-run supply schedule?
b. What is the long-run equilibrium price? The total industry output? The output of each firm? The profits of each firm?
c. The short-run total cost curve associated with each firm's long-run equilibrium output is given by
STC=.5q^2-10q+200
where SMC=q-10. Calculate the short-run average and marginal cost curves. At what necktie output level does short-run average cost reach a minimum?
d. Calculate the short-run supply curve for each firm and the industry short-run supply curve.

Reference no: EM13739347

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