Calculate the market equilibrium price and quantity

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Reference no: EM13983883

Suppose that there are 100 identical firms in a market. Each firm has a short-run marginal cost and average variable cost functions given by

SMC = 2+4Q

AVC = 2+2Q.

(a) Determine the supply function of each firm.

(b) Determine the market supply function.

(c) Suppose that the market demand function is given by P = 10 − 0.01Q. Calculate the market equilibrium price and quantity.

(d) Calculate the profit made by each firm.

Reference no: EM13983883

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