Consider a competitive industry and a price-taking firm that produces in that industry.The market demand and supply functions are estimated to be: Demand: Supply: where Q is quantity,P is the price of the product,M is income,and is the input price.The manager of the perfectly competitive firm uses timeseries data to obtain the following forecasted values of M and for 2021: The manager also estimates the average variable cost function to be Total fixed costs will be $2,000 in 2021.The minimum value of average variable cost is $_____.
A)$0.50
B)$0.75
C)$0.975
D)$1.00
E)$2.15