Consider a perfectly competitive market for wheat in Chicago. There are 80 firms in the industry, each of which

Consider a perfectly competitive market for wheat in Chicago. There are 80 firms in the industry, each of which has the cost curve

 

 

answer:

Industry supply curve would be same as rising portion of marginal cost curve shifting output multiplying by 80.

Short run market price would be $40 while in long run equilibrium price would be $60.

At current short run market price firms will leave the market in short run. In the long run, less will be produced in the market given the current market price.

 

 

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