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How many firms will there be in long run equilibrium

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Reference no: EM13975194

Suppose there are n identical firms in a market. Each firm has fixed cost equal to 392, and variable cost given by VC = 2q2, where q is the amount that an individual firm produces. This means that an individual firm's marginal cost is given by MC = 4q. Also, the market demand is given by. P = 1148  3Q, where Q is the total amount of the good produced by all of the firms combined. Therefore, Q = n*q. 

(a) How much output will each of them produce? 

(b) What will be the market price?

(c) How many firms will there be in long run equilibrium? 

Reference no: EM13975194

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