2. Consider a competitive market where there are two types of firms, Type A and Type B, with total cost functions TC^ (q) = 2 + 4q + 2q? 3 TC®(q) =3+q+ 29 (a) Derive the short-run supply curve for each firm type. (b) What is the short-run market supply, if there are 8 Type A firms, and 6 Type B firms? (c) What is total quantity produced when p=5? (d) How does your answer at (c) change if we consider long run supply rather than short run? Here, assume again that p=5 and that there are 8 Type A firms and 6 Type B firms.

ENGR.ECONOMIC ANALYSIS
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2. Consider a competitive market where there are two types of firms, Type A and Type B, with total cost
functions
TCA(g) = 2+ 4q + 2q²
TCB(
3
9) = 3+ q +
23
(a) Derive the short-run supply curve for each firm type.
(b) What is the short-run market supply, if there are 8 Type A firms, and 6 Type B firms?
(c) What is total quantity produced when p=5?
(d) How does your answer at (c) change if we consider long run supply rather than short run? Here, assume
again that p=5 and that there are 8 Type A firms and 6 Type B firms.
Transcribed Image Text:2. Consider a competitive market where there are two types of firms, Type A and Type B, with total cost functions TCA(g) = 2+ 4q + 2q² TCB( 3 9) = 3+ q + 23 (a) Derive the short-run supply curve for each firm type. (b) What is the short-run market supply, if there are 8 Type A firms, and 6 Type B firms? (c) What is total quantity produced when p=5? (d) How does your answer at (c) change if we consider long run supply rather than short run? Here, assume again that p=5 and that there are 8 Type A firms and 6 Type B firms.
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