(3 )We make some assumption about the number of firms- perhaps free entry of identical firms, perhaps something else This last assumption gives us a great deal of power-this is the equilibrium assumption in action Together, profit maximization and free entry of identical firms gives us the following two sets of conditions(assuming that the production function is continuously differentiable and concave) of() W for each input marginal revenue equals prIce. And given these first order conditions(3) We make some assumption about the number of firms– perhaps free entry of identical firms, perhaps something else. This last assumption gives us a great deal of power– this is the equilibrium assumption in action. Together, profit maximization and free entry of identical firms gives us the following two sets of conditions (assuming that the production function is continuously differentiable and concave). P fZ Zi  Wi for each input marginal revenue equals price. And given these first order conditions: