Question

Consider firm D selling burgers. The market for burgers is perfectly competitive. The following table shows the costs of firm D.

Q	TC	MC	ATC
0	25	NA	0
1	75	50	75
2	115	40	57.5
3	150	35	50
4	190	40	47.5
5	235	45	47
6	285	50	47.5
7	340	55	48.57
8	400	60	50

1. The following table shows the market supply and market demand for burgers.

Price	Market quantity supplied of burgers	Market quantity demanded of burgers
$40	2500	5500
45	3000	5000
50	3500	4500
55	4000	4000
60	4500	3500
65	5000	3000
70	5500	2500

1. How much is the equilibrium market price? Equilibrium Price is $55
2. Suppose firm D maximizes profit, how much will firm D produce and sell? How much is the ATC? How much is the profit of firm D?

Answer 1