Economics
posted by hiten .
Suppose a monopolistically competitive firm’s demand is given by
P = 100 – 2Q
And its cost function is given by
TC = 5 + 2Q
a. Find the profit maximizing quantity, price, and total profit level.
b. Is this a longrun or a shortrun outcome? How do you know?
c. Assuming that the slope of the demand curve remains constant, what will be the longrun equilibrium price and quantity for the firm?
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