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A firm can produce any quantity of good X with the following cost structure: TC = 450,000 + 20Q, where Q measures units of output.
A) The industry demand for good X is Q = 100,000 - 500P. At the profit-maximizing output level, calculate the firm's ATC of production.
B) Suppose the profit-maximizing output level you calculated to answer part A is split evenly between two firms, each with the cost structure given by TC = 450,000 + 20Q. What is the ATC of production in this two-firm industry?
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