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Answers to the questions
Recent demands and supply formula
Demand formula, quantity demanded in the market (QD), P= a-cQ, whereas supply formula (QS), P=tQ.
On entry, the firms can opt to price their products at a lower price compared to their rivals. Since there is perfect knowledge in this market structure, consumers, being rational will buy from the cheapest supplier (Samuelson & Marks 216). This strategy will enable them to penetrate the market. The firm will make little profit since it will seek to maximize the units sold since its charges lower prices. The firm will also need to consider its total cost when pricing. However, this strategy will be short lived since other firms in the market will lower their prices as well.
Lower average cost
The firm will need to maintain its average costs at the minimum to make a profit. Average cost is given by the total costs incurred in the production divided by the units produced.
Maximize Total Revenue
Total revenue is given by the average revenue multiplied by the price. Therefore, the firm will be required to maximize the units sold since it cannot raise the price.
Graph what will happen to the market and the profits of the business
The Fetchy Trends Company expects to increase its sales revenue after expansion since they will now sell many units. The company expects to increase profits since the total costs are expected to remain low. However, the situation is expected to change between 6-12 months since many firms will enter the market.

The supply curve will shift to the right resulting in the reduction of the price from P1 to P2. Consequently, the quantity demanded increases from Q1 to Q2, and a new equilibrium is established at E2.
Agraph of demand and supply

The firms will only make normal profits as marginal costs will equal average costs. Therefore, firms will either leave or operate under the prevailing conditions.
The long-run profit of a perfectly competit
Alternatives for the Business
The Fetchy Trend company (FT) will need to re-organize its strategies to lower average costs for its survival or else it will exit the market((Samuelson & Marks 222).The alternative available for the business includes:
Adopt a new, superior technology
FT company will be needed to adopt a more superior technology that will translate to the reduced average costs and increased production. As such, the company will produce many units at lower costs. Additionally, the total costs will be reduced, consequently improving profits.
Exit the market
The FT company may end exiting the market if it is unable to contain the situation and if there is no alternative. However, exiting the market is the last resort.
Works cited
Samuelson, F. William & Marks. G. Stephen. Managerial Economics.8th edition.Wiley.2014.