Adrian decides to open a new ready-to-wear skirts brand. While making his study, he noticed that his fixed cost of production is 120 dollars. Following the information.Jacob wants to do a marginal analysis to help him decide if he shall enter the market. a. Define and find the shut-down price and the shut-down quantity for Jacob’s firm Explain the way you identify these two values. b. Find the marginal revenue and determine the quantity that maximizes Jacob’s output? Explain your answer and provide the formula. c. According to your calculations, what is your advice for Jacob? Should he stay or leave the market? Explain your answer.
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Adrian decides to open a new ready-to-wear skirts brand. While making his study, he noticed that his fixed cost of production is 120 dollars. Following the information.Jacob wants to do a marginal analysis to help him decide if he shall enter the market.
a. Define and find the shut-down
b. Find the marginal revenue and determine the quantity that maximizes Jacob’s output? Explain your answer and provide the formula.
c. According to your calculations, what is your advice for Jacob? Should he stay or leave the market? Explain your answer.
d. Calculate the value of the profit realized by the firm.
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