(b) A toy factory operates in a perfectly competitive market. Setting up and constructing a factory costs 2 million. The marginal cost of the qth toy is equal to 10 for all q≤ 100 and equal to for all q> 100. 1000 (i) What are average total costs? (iiWhat is short-run supply? (iii) Suppose the price is 14.4. What is the profit maximizing choice of output in the short-run?
