Chapter12: Firms In Perfectly Competitive Markets
Section: Chapter Questions
Problem 13P
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do fast i will 5 upvotes.
![Suppose that a firm in a competitive market has the following cost curves:
20
18
16
PRICE
NWA
14
13
12
10
co
8
6
4
MC
2
2
3
5
QUANTITY
ATC
AVC
Refer to Figure 14-1. If the market price is $5, the firm will earn
a. positive economic profits in the short run.
b. negative economic profits in the short run but remain in business.
O c. negative economic profits and shut down.
d. zero economic profits in the short run.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdf341a9a-ea9a-4719-8992-ce3681aa0f90%2Faebfaec2-99dd-4799-9c09-eabd977c641a%2Fzg85wsj_processed.png&w=3840&q=75)
Transcribed Image Text:Suppose that a firm in a competitive market has the following cost curves:
20
18
16
PRICE
NWA
14
13
12
10
co
8
6
4
MC
2
2
3
5
QUANTITY
ATC
AVC
Refer to Figure 14-1. If the market price is $5, the firm will earn
a. positive economic profits in the short run.
b. negative economic profits in the short run but remain in business.
O c. negative economic profits and shut down.
d. zero economic profits in the short run.
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