Suppose the market for Android smart phones is perfectly competitive. All firms are identical with the same cost functions: T C = q 2 + 80q + 100, MC = 2q + 80, (q is the quantity produced by a representative firm).
The market demand is P = 150 - Q. (Q is market quantity).
(a) Given the above information: find the equation for FC, VC, ATC, and AVC.
(b) Determine q and P in the long run.
(c) Determine the number of firms that will compete in this market in the long run.
(d) Calculate the value of profits for a representative firm in the long run?