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Suppose that the (inverse) demand curve for Cranberries is given by P = 40 - 6Q and TC = $4Q + $3Q2
a. What are four conditions required for a competitive market?
b. What is equilibrium Price and Quantity and Profit if the market is competitive?
c. What is equilibrium Price and Quantity and Profit if there are two firms in the market (note Q = q1+ q2)
d. What is equilibrium Price and Quantity and Profit if there are monopoly in the market (note Q = Q)?
e. If there were 3 firms, where do you estimate the output and the price would be-this does not require a mathematical calculation-it is based on the expectations created by the prior three answers (1-b, 1-c, and 1-d).
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