A textile firm in a competitive industry employs a particularly efficient manager to run the operations at its production facility. In the textile industry, a plant manager typically makes a salary of $4,500 per month. The textile firm employing the superior manager faces the LAC and LMC curves shown in the figure below. In long-run competitive equilibrium, the price of the product is $9. D-If the superior plant manager also owned the textile firm, she would earn $___________ of economic profit.
A textile firm in a competitive industry employs a particularly efficient manager to run the operations at its production facility. In the textile industry, a plant manager typically makes a salary of $4,500 per month. The textile firm employing the superior manager faces the LAC and LMC curves shown in the figure below. In long-run competitive equilibrium, the price of the product is $9. D-If the superior plant manager also owned the textile firm, she would earn $___________ of economic profit.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
A textile firm in a competitive industry employs a particularly efficient manager to
run the operations at its production facility. In the textile industry, a plant manager
typically makes a salary of $4,500 per month. The textile firm employing the
superior manager faces the LAC and LMC
long-run competitive
D-If the superior plant manager also owned the textile firm, she would earn
$___________ of economic profit. Explain your answer.
Transcribed Image Text:A textile firm in a competitive industry employs a particularly efficient manager to
run the operations at its production facility. In the textile industry, a plant manager
typically makes a salary of $4,500 per month. The textile firm employing the
superior manager faces the LAC and LMC curves shown in the figure below. In
long-run competitive equilibrium, the price of the product is $9.
LMC
12
10
LAC
Q
100
200
300
400
500
600
700
Output
4
2.
Price and cost ($)
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