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Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1 per poster. She has fixed costs of $250. Her variable costs are $1,000 for the first thousand posters, $800 for the second thousand, and then $750 for each additional thousand posters. Instructions: Enter your answers rounded to two decimal places. a. What is her AFC per poster (not per thousand!) if she prints 1,000 posters? $ .25 What if she prints 2,000 posters? 2$ .125 What if she prints 10,000 posters? 2$ .025 b. What is her ATC per poster if she prints 1,000? 2$ 1.25 What if she prints 2,000? $ 1.025 What if she prints 10,000? $ .805 c. If the market price fell to 70 cents per poster, would there be any output level at which Karen would not shut down production immediately? No

Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1 per poster. She has fixed costs of $250. Her variable costs are $1,000 for the first thousand posters, $800 for the second thousand, and then $750 for each additional thousand posters. Instructions: Enter your answers rounded to two decimal places. a. What is her AFC per poster (not per thousand!) if she prints 1,000 posters? $ .25 What if she prints 2,000 posters? 2$ .125 What if she prints 10,000 posters? 2$ .025 b. What is her ATC per poster if she prints 1,000? 2$ 1.25 What if she prints 2,000? $ 1.025 What if she prints 10,000? $ .805 c. If the market price fell to 70 cents per poster, would there be any output level at which Karen would not shut down production immediately? No

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1 per poster. She has fixed costs of $250. Her variable costs are $1,000 for the first thousand posters, $800 for the second thousand, and then $750 for each additional thousand posters. Instructions: Enter your answers rounded to two decimal places. a. What is her AFC per poster (not per thousand!) if she prints 1,000 posters? .25 What if she prints 2,000 posters? .125 What if she prints 10,000 posters? $ .025 b. What is her ATC per poster if she prints 1,000? 1.25 What if she prints 2,000? 1.025 What if she prints 10,000? $ .805 c. If the market price fell to 70 cents per poster, would there be any output level at which Karen would not shut down production immediately? No %24 %24
Transcribed Image Text:Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1 per poster. She has fixed costs of $250. Her variable costs are $1,000 for the first thousand posters, $800 for the second thousand, and then $750 for each additional thousand posters. Instructions: Enter your answers rounded to two decimal places. a. What is her AFC per poster (not per thousand!) if she prints 1,000 posters? .25 What if she prints 2,000 posters? .125 What if she prints 10,000 posters? $ .025 b. What is her ATC per poster if she prints 1,000? 1.25 What if she prints 2,000? 1.025 What if she prints 10,000? $ .805 c. If the market price fell to 70 cents per poster, would there be any output level at which Karen would not shut down production immediately? No %24 %24
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