Market characterized by pure competition

Question

Problem: Suppose you are given the following information about a particular industry:

Q^D = 6500 – 100P    Market Demand
Q^S = 1200P              Market Supply

C(q) = 722 + q²/200   Firm total cost function

MC(q) = 2q/200          Firm marginal cost function

Assume that all firms are identical and that the market is characterized by pure competition.

Question 1: Find the equilibrium price, the equilibrium quantity, the output supplied by the firm, and the profit of each firm.

Question 2: Would you expect to see entry into or exit from the industry in the long run? What effect will entry or exit have on market equilibrium?

Question 3: What is the lowest price at which each firm would sell its output in the long run? Is profit positive, negative, or zero at this price?

Question 4: What is the lowest price at which each firm would sell its output in the short run? Is profit positive, negative, or zero at this price?