Question

1. To find the long-run number of firms in a competitive market,
Question 23 options:

a) multiply the price by quantity.

b) divide the industry output (Q*) by the optimal scale (q*).

c) multiply the industry output (Q*) by the optimal scale (q*).

d) divide the average total cost by the marginal cost.

e) add the industry output (Q*) to the marginal cost.

2. The supply and demand in the market for tires are given by the following functions:

QD = 500 – 2P
QS = 100 + 3P

At a price of $60 per tire, there is a

a)

surplus of 100 units

b)

shortage of 100 units

c)

surplus of $100

d)

surplus of 120 units

e)

shortage of 120 units

Answer 1

Answer 1 option b

Answer 2 option b

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