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Suppose that there are 40 firms in market, each with the following cost function: C(q) = 20 + 2q^2. Part one - Derive the short-term market supply curve. Part two - Explain if the firm will shut down or not. Part three - Find the equilibrium market quantity and price if the market demand is Qd = 320 - 30p. Part four - how much output will each firm produce? Part five - How much profit will each firm make at this point?
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