Answer Happy

Please refer to the background information below to answer the following two questions. Consider two firms in a competitive market. The following table shows the marginal costs ($) of the two firms. Firm 2 Output Firm 1 1 7.00 2 13.50 3 15.00 4 15.50 5 19.50 6 25.00 7 25.50 8 26.50 9 29.00 10 29.50 11 34.00 12 39.00 7.50 8.50 11.00 17.50 20.00 20.50 24.00 24.50 26.00 35.50 38.00 39.50 50. If the equilibrium price is higher than or equal to $[ Answer50A = 17.50 ) and strictly less than $[ Answer50B = 19.50 ), the two firms will produce a total of 8 units and the allocation of production will be efficient. 51. When firms 1 and 2 produce a total of 8 units, the socially optimal quantities produced by firm 1 is Answer51A = 4.00 ) unit(s) and firm 2 ( Answer51B = 4.00 ) unit(s).