This is what I have, qi=20, AC(average cost)=10, and (total market demand) Q=1500-50p. What is the industry's long-run supply schedule?
perfectly competitive. So horizontal supply schedule?
I hope I gave you enough information in your latter post. Repost if you need more help. Question: does qi mean "quantity produced by firm i"?
yes, subscript i. don't know how to type that here. i don't have my equations with me so i'm still not quite sure how to get the equilibrium and profits? (did i do the other correctly?) There is a lot more for this problem too. I will probably be asking more questions later. I just need to make sure I'm doing this correctly :)
how u guys get the 500+50p?
To find the industry's long-run supply schedule, we need to determine the relationship between the market price (p) and the quantity supplied in the long run.
First, let's find the equilibrium price and quantity by setting the quantity demanded (Q) equal to the quantity supplied.
Given:
Q = 1500 - 50p (Total market demand)
AC = 10 (Average cost)
Equilibrium occurs when Qd = Qs:
1500 - 50p = Qs
Now, we need to find the quantity supplied at different price levels to determine the long-run supply schedule. We can do this by rearranging the equation to solve for p:
Qs = 1500 - 50p
50p = 1500 - Qs
p = (1500 - Qs)/50
To find the quantity supplied (Qs), we need to determine the point where the average cost equals the market price (AC = p):
AC = p = (1500 - Qs)/50
Now, substitute AC = 10 into the equation:
10 = (1500 - Qs)/50
Solve for Qs:
500 = 1500 - Qs
Qs = 1000
So, in the long run, the industry's supply quantity (Qs) is 1000 when the market price (p) is equal to the average cost (AC = 10).
To create the industry's long-run supply schedule, we need to find other price-quantity combinations where the market price equals the average cost. We can do this by plugging in different price levels into the equation p = (1500 - Qs)/50, and calculating the corresponding quantity supplied.