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SOLVED:Consider a monopolistically competitive market with N̅ firms. Each firm's business opportunities are described by the following equations: Demand: Q =100 / N-P Marginal Revenue: M R =100 / N-2 Q Total cost: T C =50 Q^2 Marginal cost: M C=2 Q a. How does N, the number of firms in the market, affect each firm's demand curve? Why? b. How many units does each firm produce? (The answers to this and the next two questions depend on N . ) c. What price does each firm charge? d
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SOLVED:Consider a monopolistically competitive market with N̅ firms. Each firm's business opportunities are described by the following equations: Demand: Q =100 / N-P Marginal Revenue: M R =100 / N-2 Q Total cost: T C =50 Q^2 Marginal cost: M C=2 Q a. How does N, the number of firms in the market, affect each firm's demand curve? Why? b. How many units does each firm produce? (The answers to this and the next two questions depend on N . ) c. What price does each firm charge? d
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