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Suppose that a firm sells its product in a perfectly competitive market. The firm's fixed costs (including a "normal" return on the funds the entrepreneur has invested in the firm) are equal to $100 and its variable cost schedule is as follows:
Output (Units) Variable Cost per Unit50 $5.00100 4.50150 4.00200 3.50250 3.00300 2.75350 3.00400 3.50
a.Find the marginal cost and average total cost schedules for the firm.b.If the prevailing market price is $4.50, how many units will be produced and sold?c.What are total profits and profit per unit at the output level determined in part (b)?d.Is the industry in long-run equilibrium at this price? Explain
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