A firm sells 1,000 units per week. Suppose the average variable cost is $40, and the average cost is $70. In the short run, the break-even price is . In the long run, the break-even price is . Suppose the firm charges a price of $25 per unit. Use the following table to indicate whether the firm will shut down or continue to produce in the short run and the long run. Time Continue to Produce Shut Down Short Run Long Run
A firm sells 1,000 units per week. Suppose the average variable cost is $40, and the average cost is $70. In the short run, the break-even price is . In the long run, the break-even price is . Suppose the firm charges a price of $25 per unit. Use the following table to indicate whether the firm will shut down or continue to produce in the short run and the long run. Time Continue to Produce Shut Down Short Run Long Run
Principles of Microeconomics
7th Edition
ISBN:9781305156050
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter13: The Cost Of Production
Section: Chapter Questions
Problem 1PA
Related questions
Question
A firm sells 1,000 units per week. Suppose the average variable cost is $40, and the average cost is $70.
In the short run, the break-even price is
. In the long run, the break-even price is
.
Suppose the firm charges a price of $25 per unit.
Use the following table to indicate whether the firm will shut down or continue to produce in the short run and the long run.
Time
|
Continue to Produce
|
Shut Down
|
|
---|---|---|---|
Short Run |
|
|
|
Long Run |
|
|
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Microeconomics
Economics
ISBN:
9781305156050
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Microeconomics: Principles & Policy
Economics
ISBN:
9781337794992
Author:
William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:
Cengage Learning
Principles of Microeconomics
Economics
ISBN:
9781305156050
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Microeconomics: Principles & Policy
Economics
ISBN:
9781337794992
Author:
William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:
Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning