What are the price and quantity consumed in the long run

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Suppose a competitive market consists of identical firms with a constant long-run marginal cost of $10. There are no fixed costs in the short run or long run. Suppose the demand curve is given by Q(P) = 1000-p

a. What is the short run perfectly competive equilibrium with 100 identical firms?

b. What are the price and quantity consumed in the long run competitive equilibrium?

c. Suppose one new firm enters that is di§erent from existing firms. The new firm has a constant marginal cost of $9 and no fixed costs, but can only produce 10 or fewr units of output. What are the price and quantity consumed in the new long-run competitive equilibrium?

Reference no: EM13236478

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