A Competitive Market Is Made Up of 100 Identical Firms

Essay

A competitive market is made up of 100 identical firms. Each firm has a short-run marginal cost function as follows:
MC = 5 + 0.5Q,
where Q represents units of output per unit of time. The firm's average variable cost curve intersects the marginal cost at a vertical distance of 10 above the horizontal axis. Determine the market short-run supply curve. Calculate the price that would make 2,000 units forthcoming per time period. Note the minimum price at which any quantity would be placed on the market.