1. There are two firms, A and B, on a competitive market. Firm A's total cost is given by: TC^(Q)=1+0.50² and firm B's total cost is given by: TCB (Q) = 0.502 +60 The market demand curve is Q₁ = 6-p. We denote by Qs the market supply (i.e., the sum of firm A's supply and firm B's supply). (b) What is the slope of the market supply curve (i.e. dQs/dp) when p = 3? What is the slope of market supply curve when p = 7? (c) Find the market equilibrium price p* and quantity Q*.

1. There are two firms, A and B, on a competitive market. Firm A's total cost is given by: TC^(Q)=1+0.50² and firm B's total cost is given by: TCB (Q) = 0.502 +60 The market demand curve is Q₁ = 6-p. We denote by Qs the market supply (i.e., the sum of firm A's supply and firm B's supply). (b) What is the slope of the market supply curve (i.e. dQs/dp) when p = 3? What is the slope of market supply curve when p = 7? (c) Find the market equilibrium price p* and quantity Q*.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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