What is the equilibrium price under monopolistic competition

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Lawn-Cutting Equilibrium. Consider the market for cutting lawns. Each firm has a fixed daily cost of $18 for equipment, and the marginal cost of cutting a lawn is $4. Suppose each firm can cut up to three lawns per day. The market demand curve for lawn cuts is linear, with a vertical intercept of $70 and a slope of $1 per lawn.

a. If each firm in the market cuts three lawns, what is the average cost per lawn?

b. What is the equilibrium price under monopolistic competition?

c. How many lawns will be cut in total, and how many firms will be in the market

Reference no: EM131132866

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