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A monopolist can produce at a constant average and marginal cost of ATC = MC =...

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Economics

A monopolist can produce at a constant average andmarginal cost of ATC = MC = $5. It faces a market demand curvegiven by Q = 53 - P.

5. Suppose there are N firms in the industry, all withthe same constant MC = $5. Find the Cournot equilibrium. How muchwill each firm produce, what will be the market price, and how muchprofit will each firm earn? Also show that as N becomes large, themarket price approaches the price that would prevail under perfectcompetition. (Hint: your answers will be functions ofN)

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