In the Local Cotton Market, There Are 1,000 Producers That

Essay

In the local cotton market, there are 1,000 producers that have identical short-run cost functions. They are: C(q) = 0.025q² + 200, where q is the number of bales produced each period. The short-run marginal cost function for each producer is: MC(q) = 0.05q. If the local cotton market is perfectly competitive, what is each cotton producer's short-run supply curve? Derive the local market supply curve of cotton.