Question #2001936: Other Economics Problems

Question: 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 the minimum point occurred at an output of 1,000 boxes per month. The market demand curve for boxes was:

QD = 140,000 – 10,000P

Where P is the price of a box (in dollars per box) and QD is the quantity of boxes demanded per month. The market supply curve for boxes was:

QS = 80,000 + 5,000P

Where QS is the quantity of boxes supplied per month.

a) What is the equilibrium price of a box?

b) What is the equilibrium quantity of boxes in the market?

c) How many firms in the market?

Solution: The solution consists of 184 words (2 pages)
Deliverables: Word Document

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