What could exist as market price in the long run equilibrium

Reference no: EM13238340

A firm in a purely competitive industry is currently producing 1200 per day at a total cost of $ 600. If the firm produced 1000 units per day, its total cost would be $ 400, and if it produced 700 units per day, its total cost would be $ 375.

What is the firm's ATC per unit at these three level of production? if every firm in this industry has the same cost structure, is the industry in long run competitive equilibrium? from what you know about these firms cost structure, what is the highest price possible price per unit that could exist as market price in the long run equilibrium? if that price ends up being the market price and if the normal rate of profit is 10 percent, then how big will each firms accounting profit per unit be?

Reference no: EM13238340

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