There are 300 purely competitive farms in the local dairy market. Of the 300 dairy farms, 298 have a cost structure that generates profits of $24 for every $300 invested What is their percentage rate of return?
The other two dairies have a cost sturcture that generates profits of $22 for every $200 invested. Will the chnage in the number of firms affect the two that earn $22 for $200 invested?
What will be the rate of return earned by most firms in the industry in long-run equillibrium?
If firms can copy each other's technology, what will be the rate of return eventually by all firms?