I need help getting to the solution for (25). Use the following information to a

Question

I need help getting to the solution for (25).

Use the following information to answer the next three (3) questions. Consider a perfectly competitive industry for tablets with many identical firms. Each competitive firm in this industry has cost functions as follows: TC = 6q^2 + 9q + 54 and MC = 12q + 9 where quantity is in hundreds of thousands and price in tens of dollars. Assume that the current scale of production minimizes the long run average cost structure. Initially, the industry demand for tablets is P = 81 - Q. The price in the long run is and there are firms are in the market in the long run. $45, 6 firms. $40,20 firms. $40, 15 firms. $45, 12 firms. After 3 months of intensive advertising, the industry demand for tablets increased to: P = 105- Q. The price in the short run is, each firm produces and has profits (in the original scale of production). $50, 3, negative. $57, 4, positive. $50,4, zero. $57,4, negative.

Explanation / Answer

Q = 12q

For equilibrium,

P = MC

105 - Q = 12q + 9

105 - 12q = 12q + 9

24q = 96

q = 4

P = 105 - 12q = 105 - 12*4 = 57

Since , it's n't the point of minimum AC, so there will be positive profit.

So, answer is B. $57, 4 , Positive.

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