Calculate the average total cost at these different sales

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Assume that a purely competitive firm is selling 2000 television sets a day at a cost of $90,000. Assume that if the firm sells 1600 units per day, its total cost would be $60,000, and if it sold 1000 units per day, it would have a total cost of $55,000.

Calculate the average total cost at these different sales levels.

Assuming that the cost structure for every firm in the industry is identical, do you think that the industry could be in long-run equilibrium?

If the industry is perfectly competitive, what would be the long-run equilibrium market price?

If your answer to c is the market price and every firm in the industry is earning a normal profit of 15 percent, calculate what that profit would be.

Reference no: EM13301682

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