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A firm in a purely competitive industry is currently producing a 1000 unir per day at a total cost of $450. if the firm produced 800 units per day, it total cost will be $300, and it it produced 500 units per day, it total cost will be $275. Requirements:
(1) what are the firm's ATC per unit at these three levels of production?
(2) if every firm in this industry has the same cost structure, is the industry in long-run competitive equilibrium?
(3) from what you know about these firms's cost structure, what is the highest possible price per unit that could be exist as the market price in the long run equilibrium?
4) if that price ends up being the market price and if the normal rate of profit is 10 percent , the how big will each firm's accounting profit per unit be?
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