Suppose that the market for cashmere sweaters is a competitive market. The following graph shows the daily cost curves of a firm operating in this market. Hint: After placing the rectangle on the graph, you can select an endpoint to see the coordinates of that point. 100 90 Profit or Loss 80 70 60 50 40 ATC 20 AVC MC 10 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of sweaters per day) In the short run, at a market price of $45 per sweater, this firm will choose to produce sweaters per day. PRICE (Dollars per sweater)
Suppose that the market for cashmere sweaters is a competitive market. The following graph shows the daily cost curves of a firm operating in this market. Hint: After placing the rectangle on the graph, you can select an endpoint to see the coordinates of that point. 100 90 Profit or Loss 80 70 60 50 40 ATC 20 AVC MC 10 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of sweaters per day) In the short run, at a market price of $45 per sweater, this firm will choose to produce sweaters per day. PRICE (Dollars per sweater)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![On the preceding graph, use the blue rectangle (circle symbols) to shade the area representing the firm's profit or loss if the market price is $45 and
the firm chooses to produce the quantity you already selected.
Note: In the following question, enter a positive number, even if it represents
loss.
The area of this rectangle indicates that the firm's
would be $
thousand per day in the short run.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9a7d40cd-7db9-456e-96f7-a0646ab995d6%2F544becfb-bbd5-42e2-98c8-7a9450519491%2Fneyrrrj_processed.png&w=3840&q=75)
Transcribed Image Text:On the preceding graph, use the blue rectangle (circle symbols) to shade the area representing the firm's profit or loss if the market price is $45 and
the firm chooses to produce the quantity you already selected.
Note: In the following question, enter a positive number, even if it represents
loss.
The area of this rectangle indicates that the firm's
would be $
thousand per day in the short run.
![4. Profit maximization in the cost-curve diagram
Suppose that the market for cashmere sweaters is a competitive market. The following graph shows the daily cost curves of a firm operating in this
market.
Hint: After placing the rectangle on the graph, you can select an endpoint to see the coordinates of that point.
100
90
Profit or Loss
80
ATC
20
AVC
MC
10
10
20
30
40
50
60
70
80
90
100
QUANTITY (Thousands of sweaters per day)
In the short run, at a market price of $45 per sweater, this firm will choose to produce
sweaters per day.
PRICE (Dollars per sweater)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9a7d40cd-7db9-456e-96f7-a0646ab995d6%2F544becfb-bbd5-42e2-98c8-7a9450519491%2Faw9eld_processed.png&w=3840&q=75)
Transcribed Image Text:4. Profit maximization in the cost-curve diagram
Suppose that the market for cashmere sweaters is a competitive market. The following graph shows the daily cost curves of a firm operating in this
market.
Hint: After placing the rectangle on the graph, you can select an endpoint to see the coordinates of that point.
100
90
Profit or Loss
80
ATC
20
AVC
MC
10
10
20
30
40
50
60
70
80
90
100
QUANTITY (Thousands of sweaters per day)
In the short run, at a market price of $45 per sweater, this firm will choose to produce
sweaters per day.
PRICE (Dollars per sweater)
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