Question: Gasoline is sold through local gasoline stations under perfectly competitive conditions. All gasoline station owners face the same long-run total cost curve given by \(TC=0.01{{q}^{2}}-q+100\) , where q is the number of gallons sold per day.

1. Assuming the market is in long-run equilibrium, how much gasoline will each individual owner sell per day? What are the long-run average cost and marginal cost at this output level?
2. The market demand for gasoline is given by \({{Q}_{D}}=2,500,000-500,000P\). Given your answer to part a. what will be the price of gasoline in long-run equilibrium? How much gasoline will be demanded, and how many gas station will there be?
3. Suppose that because of the development of solar-powered cars, the market demand for gasoline shifts inward to \({{Q}_{D}}=2,000,000-1,000,000P\). In the long-run equilibrium, what will be the price of gasoline? How much total gasoline will be demanded, and how many gas stations will there be?
4. Graph your results

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