$48 46 44 42 40 38 36 34 32 30 MC ATC Df= MR 28 26 24 AVC 22 20 18 16 14 12 10 AFC 8. 6. 4 Quantity 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 7.5 8 8.5 9 9.5 10

Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter13: Capital, Interest, Entrepreneurship, And Corporate Finance
Section: Chapter Questions
Problem 6QFR
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The following graph summarizes the demand and costs for a firm that operates in a perfectly competitive market. a. What level of output should this firm produce in the short run? b. What price should this firm charge in the short run? c. What is the firm’s total cost at this level of output? d. What is the firm’s total variable cost at this level of output? e. What is the firm’s fixed cost at this level of output? f. What is the firm’s profit if it produces this level of output? g. What is the firm’s profit if it shuts down? h. In the long run, should this firm continue to operate or shut DOWN

$48
46
44
42
40
38
36
34
32
30
MC
ATC
Df= MR
28
26
24
AVC
22
20
18
16
14
12
10
AFC
8.
6.
4
Quantity
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 7.5 8 8.5 9 9.5 10
Transcribed Image Text:$48 46 44 42 40 38 36 34 32 30 MC ATC Df= MR 28 26 24 AVC 22 20 18 16 14 12 10 AFC 8. 6. 4 Quantity 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 7.5 8 8.5 9 9.5 10
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