The following diagram shows the market demand for steel. Use the orange points (square symbol) to plot the Initial short-run Industry supply curve when there are 20 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output, since this is the Industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 30 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 40 firns. 100 90 Supply (20 firms) 80 70 60 Suply (30 frms) 50 40 Seply (40 frma) Demand 30 20 20 125 250 375 500 625 750 875 1000 1125 1250 QUANTITY (Thausands of tans) If there were 30 firms in this market, the short-run equilibrum price of steel would be s . Therefore, In the long run, firms would | per ton. At that price, firms in this industry would the steel market. Because you know that perfectly competitive firms earn v economic profit in the long run, you know the long-run equilibrium price must be per ton. From the graph, you can see that this means there will be firms operating in the steel Industry in long-run equilibrium. (us nd spa) aoad