The market demand curve for commodity X is `q^(D)=700-p`. Now, let us allow for free entry and exit of the firms producing commodity X. Also assume the market consists of identical firms producing commodity X. Let the supply curve of a single firm be explained as:
`q_(t)^(S)=8+3p " for "pge20`
`=0 " for "0le p lt 20`
(a) What is the significance of p = 20?
(b) Calculate the equilibrium quantity and number of firms at the equilibrium price of rupee 20.