4. Profit maximization in the cost-curve diagram The following graph plots daily cost curves for a firm operating in the competitive market for jumpsuits. Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates. PRICE (Dollars per jumpsuit) 50 45 40 35 30 25 20 15 10 5 0 O MC CATC 0 2 4 6 AVC 8 10 12 14 16 18 QUANTITY (Thousands of jumpsuits per day) 20 Profit or Loss ? In the short run, given a market price equal to $15 per jumpsuit, the firm should produce a daily quantity of 8,000 jumpsuits.
4. Profit maximization in the cost-curve diagram The following graph plots daily cost curves for a firm operating in the competitive market for jumpsuits. Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates. PRICE (Dollars per jumpsuit) 50 45 40 35 30 25 20 15 10 5 0 O MC CATC 0 2 4 6 AVC 8 10 12 14 16 18 QUANTITY (Thousands of jumpsuits per day) 20 Profit or Loss ? In the short run, given a market price equal to $15 per jumpsuit, the firm should produce a daily quantity of 8,000 jumpsuits.
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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Question
Transcribed Image Text:On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of
$15 and the quantity of production from your previous answer.
Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss.
The rectangular area represents a short-run loss of $120 thousand per day for the firm.
Transcribed Image Text:4. Profit maximization in the cost-curve diagram
The following graph plots daily cost curves for a firm operating in the competitive market for jumpsuits.
Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates.
PRICE (Dollars per jumpsuit)
50
45
40
35
30
25
20
15
10
5
0
O
MC
CATC
0 2 4 6
AVC
8 10 12 14 16 18
QUANTITY (Thousands of jumpsuits per day)
20
Profit or Loss
?
In the short run, given a market price equal to $15 per jumpsuit, the firm should produce a daily quantity of 8,000
jumpsuits.
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