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Suppose there are 100 identical firms in the perfectly competitive note-card industry. Each firm has a short-run total cost curve of the form: ST C = 0.2q^2 + 4q + 10 and MC = 0.4q + 4.
a.. Calculate the firm’s short-run supply curve with q (the number of crates of note-cards) as a function of market price (P).
b. Calculate the industry supply function.
c. Suppose the market demand is given by Q = ?200P + 8, 000. What will be the short-run equilibrium price and quantity?
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