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    Prices in perfect competition

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    Wheat is produced under perfectly competitive conditions. Individual wheat farmers have U- shaped,long run average cost curves that meet the marginal cost curves when 800 bushels are produced and the marginal cost at that output level is $4 per bushel.
    If the market demand for wheat is given by Q = 2 400 000 - 200 000p, what would be the price of wheat in the long run? How much total wheat will be demanded? How many wheat farmers will there be? Graph your results.

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    Wheat is produced under perfectly competitive conditions. Individual wheat farmers have U-shaped long run average cost curves that meet the marginal cost curves when 800 bushels are produced and the marginal cost at that output level is ...

    Solution Summary

    Prices in perfect competition are determined.

    $2.19