1. A firm in a perfectly competitive industry has fixed costs of FC = 15, marginal costs of MC = 5+ 14q, and average variable costs of AVC = 5 + 7q.

Extracted text: 1. A firm in a perfectly competitive industry has fixed costs of FC = 15, marginal costs of MC = 5+ 14q, and average variable costs of AVC = 5 + 7q.


Extracted text: (d) Does the firm continue to supply this quantity in the short-run? (e) Suppose there exists a standard market demand function from consumers (downward slopping). Please provide a logical discussion about how the market achieves short-run equilibrium.