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In 2012, the box industry was perfectly competitive. The lowest point on the long-run average cost curve of each of the identical box producers was $4, and this minimum point occurred at an output of 1,000 boxes per month. The market demand curve for boxes was 2 marks
Q_D=140,000-10,000P
where P was the price of a box (in dollars per box) and QD was the quantity of boxes demanded per month. The market supply curve for boxes was
Q_S=80,000+5,000P
Where QS was the quantity of boxes supplied per month.
What was the equilibrium price of a box? Is this the long-run equilibrium price?
How many firms are in this industry when it is in long-run equilibrium?
Q_D=140,000-10,000P
where P was the price of a box (in dollars per box) and QD was the quantity of boxes demanded per month. The market supply curve for boxes was
Q_S=80,000+5,000P
Where QS was the quantity of boxes supplied per month.
What was the equilibrium price of a box? Is this the long-run equilibrium price?
How many firms are in this industry when it is in long-run equilibrium?
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