number of firms

[ahlashi]

Q)
if in a perfectly competitive industry the long run demand curve is given by p=1000-q and the long run average cos functionfor the representative firm  is given by (q-4)^2 +40
how many identical firms can exist in the industry
q;qty sold by a firm

PLS HELP

[Amit Goyal]

Solution is

Each firm supplies 4 units in the long run.
Price will be 40
Total quantity traded in the industry will be 1000-40 = 960
Therefore, the number of firms will be 960/4 = 240.


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