Answer the following questions and submit to the appropriate space on Be careful to completely and correctly label all of the parts of any graph you draw. Please be a neat as possible. 1. The Wernham Hogg Paper Company is a representative firm in a purely/perfectly competitive. constant-cost market. The market is currently in a long-run equilibrium a Use the blank axes below to draw completely and thoroughly labeled side-by-side graphs for the paper market and for Wernham Hogg Make sure that you clearly indicate the price and quantity of paper in the market and price and quantity for Wernham Hogg Paper is a normal good. As the result of an economic slowdown, a large number of consumers lose their jobs and their paychecks. Wernham Hogg's paper mills continue to operate. Use the graphs you drew about to show how the fall in consumer income impacts the following items in the short run L Market price and quantity & Wernham Hogg's price and quantity Shade the rectangle representing Wernham Hogg's profit or loss c. Remember that Wernham Hogg is continuing to produce paper in the midst of the economic slowdown. What must the price of paper be for this to make economic sense for the firm

Answer the following questions and submit to the appropriate space on Be careful to completely and correctly label all of the parts of any graph you draw. Please be a neat as possible. 1. The Wernham Hogg Paper Company is a representative firm in a purely/perfectly competitive. constant-cost market. The market is currently in a long-run equilibrium a Use the blank axes below to draw completely and thoroughly labeled side-by-side graphs for the paper market and for Wernham Hogg Make sure that you clearly indicate the price and quantity of paper in the market and price and quantity for Wernham Hogg Paper is a normal good. As the result of an economic slowdown, a large number of consumers lose their jobs and their paychecks. Wernham Hogg's paper mills continue to operate. Use the graphs you drew about to show how the fall in consumer income impacts the following items in the short run L Market price and quantity & Wernham Hogg's price and quantity Shade the rectangle representing Wernham Hogg's profit or loss c. Remember that Wernham Hogg is continuing to produce paper in the midst of the economic slowdown. What must the price of paper be for this to make economic sense for the firm

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4. Profit maximization using total cost and total revenue curves Suppose Sharon runs a small business that manufactures shirts. Assume that the market for shirts is a price-taker market, and the market price is $10 per shirt. The following graph shows Sharon's total cost curve. Use the blue points (circle symbol) to plot total revenue, and the green points (triangle symbol) to plot profit for the first seven shirts that Sharon produces, including zero shirts. 125 T 100 75 0 -50 30 20 15 0 1 0 2 1 3 4 5 QUANTITY (Shirts) 2 Calculate Sharon's marginal revenue and marginal cost for the first seven shirts she produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost. 3 5 QUANTITY (Shirts) 4 П 6 Total Cost ☐ 6 7 -O 8 Sharon's profit is maximized when she produces which is than would maximize her profit) is $, which is maximizing quantity corresponds to the Intersection of the last…
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