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Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 20 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 30 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 40 firms. Note: Points will snap to the quantities of output. PRICE (Dollars per tonne) 100 90 20 70 80 50 Supply (20 firms) Supply (30 firms) A 40 Demand Supply (40 firms) 30 20 10 0 0 123 250 373 500 623 750 873 1000 1123 QUANTITY (Thousands of tonnes) 1250 ? If there were 20 firms in this market, the short-run equilibrium price of steel would be $ would . Therefore, in the long run, firms would Because you know that perfectly competitive firms earn must be $ run equilibrium. per tonne. At that price, firms in this industry the steel market. per tonne, From the graph, you can see that this means there will be economic profit in the long run, you know the long-run equilibrium price firms one

Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 20 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 30 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 40 firms. Note: Points will snap to the quantities of output. PRICE (Dollars per tonne) 100 90 20 70 80 50 Supply (20 firms) Supply (30 firms) A 40 Demand Supply (40 firms) 30 20 10 0 0 123 250 373 500 623 750 873 1000 1123 QUANTITY (Thousands of tonnes) 1250 ? If there were 20 firms in this market, the short-run equilibrium price of steel would be $ would . Therefore, in the long run, firms would Because you know that perfectly competitive firms earn must be $ run equilibrium. per tonne. At that price, firms in this industry the steel market. per tonne, From the graph, you can see that this means there will be economic profit in the long run, you know the long-run equilibrium price firms one

Exploring Economics
Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter12: Firms In Perfectly Competitive Markets
Section: Chapter Questions
Problem 13P
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Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 20 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 30 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 40 firms. Note: Points will snap to the quantities of output. PRICE (Dollars per tonne) 100 90 20 70 80 50 Supply (20 firms) Supply (30 firms) A 40 Demand Supply (40 firms) 30 20 10 0 0 123 250 373 500 623 750 873 1000 1123 QUANTITY (Thousands of tonnes) 1250 ? If there were 20 firms in this market, the short-run equilibrium price of steel would be $ would . Therefore, in the long run, firms would Because you know that perfectly competitive firms earn must be $ run equilibrium. per tonne. At that price, firms in this industry the steel market. per tonne, From the graph, you can see that this means there will be economic profit in the long run, you know the long-run equilibrium price firms one
Transcribed Image Text:Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 20 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 30 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 40 firms. Note: Points will snap to the quantities of output. PRICE (Dollars per tonne) 100 90 20 70 80 50 Supply (20 firms) Supply (30 firms) A 40 Demand Supply (40 firms) 30 20 10 0 0 123 250 373 500 623 750 873 1000 1123 QUANTITY (Thousands of tonnes) 1250 ? If there were 20 firms in this market, the short-run equilibrium price of steel would be $ would . Therefore, in the long run, firms would Because you know that perfectly competitive firms earn must be $ run equilibrium. per tonne. At that price, firms in this industry the steel market. per tonne, From the graph, you can see that this means there will be economic profit in the long run, you know the long-run equilibrium price firms one
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