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the competive markest for seapback hats. On the fallowing graph, wse the arage points (square symbol) to plec points alang the partion of the firm's short-rus supply curve that correspondls whth the point closest to the arigh. You are given more paints to glot thaw you feod.) Supposie there are 9 firms in this industry, each of which has the cost curves previausiy shom. graph to indicate the shert-run equavium price and eqantity ho chs markes. Note: Dailhed drop lines will automatically extend to both axes. 6. Deriving the short-run supply curve The following graph plots the marginal cost (MC) curve, average total cost (ATC) curve, and average variable cost (AVC) curve for a firm operating in the competitive market for snapback hats. (m) 100 288 10 . MCO 4 10 ATC AVC QUANTITY (Thousands of snapback Price (Dollars per snapback) 15 20 35 45 60 95 For every price level given in the following table, use the graph to determine the profe-maximizing quantity of snapbacks for the firm. Further, select whether the firm will choose to produce, shut down, or be indifferent between the two in the short run. (Assume that when price exactly equals average variable cost, the firm is indifferent between producing zero snapbacks and the profit-maximizing quantity of snapbacks.) Lastly, determine whether the firm will earn a profit, incur a loss, or break even at each price 100 Quantity (Snapbacks) Produce or Shut Down? Profit or Loss?

the competive markest for seapback hats. On the fallowing graph, wse the arage points (square symbol) to plec points alang the partion of the firm's short-rus supply curve that correspondls whth the point closest to the arigh. You are given more paints to glot thaw you feod.) Supposie there are 9 firms in this industry, each of which has the cost curves previausiy shom. graph to indicate the shert-run equavium price and eqantity ho chs markes. Note: Dailhed drop lines will automatically extend to both axes. 6. Deriving the short-run supply curve The following graph plots the marginal cost (MC) curve, average total cost (ATC) curve, and average variable cost (AVC) curve for a firm operating in the competitive market for snapback hats. (m) 100 288 10 . MCO 4 10 ATC AVC QUANTITY (Thousands of snapback Price (Dollars per snapback) 15 20 35 45 60 95 For every price level given in the following table, use the graph to determine the profe-maximizing quantity of snapbacks for the firm. Further, select whether the firm will choose to produce, shut down, or be indifferent between the two in the short run. (Assume that when price exactly equals average variable cost, the firm is indifferent between producing zero snapbacks and the profit-maximizing quantity of snapbacks.) Lastly, determine whether the firm will earn a profit, incur a loss, or break even at each price 100 Quantity (Snapbacks) Produce or Shut Down? Profit or Loss?

Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter9: Monopoly
Section: Chapter Questions
Problem 31P: Return to Figure 9.2. Suppose P0 is 10 and P1 is 11. Suppose a new firm with the same LRAC curve as...
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the competive markest for seapback hats. On the fallowing graph, wse the arage points (square symbol) to plec points alang the partion of the firm's short-rus supply curve that correspondls whth the point closest to the arigh. You are given more paints to glot thaw you feod.) Supposie there are 9 firms in this industry, each of which has the cost curves previausiy shom. graph to indicate the shert-run equavium price and eqantity ho chs markes. Note: Dailhed drop lines will automatically extend to both axes. 6. Deriving the short-run supply curve The following graph plots the marginal cost (MC) curve, average total cost (ATC) curve, and average variable cost (AVC) curve for a firm operating in the competitive market for snapback hats. 90 70 COSTS (D) 8 8 8 8 30 20 10 a O MC 4 10 20 60 95 ATC Price (Dollars per snapback) 15 20 35 45 AVC D O 70 00 QUANTITY (Thousands of snapback) For every price lave given in the following table, use the graph to determine the profit-maximizing quantity of snapbacks for the firm. Further, select whether the firm will choose to produce, shut down, or be indifferent between the two in the short run. (Assume that when price exactly equals average variable cost, the firm is indifferent b t between producing zero snapbacks and the profit-maximizing quantity of snapbacks.) Lastly, determine whether the firm will earn a profit, incur a loss, or break even at each price 120 Quantity (Snapbacks) Produce or Shut Down? Profit or Loss?
Transcribed Image Text:the competive markest for seapback hats. On the fallowing graph, wse the arage points (square symbol) to plec points alang the partion of the firm's short-rus supply curve that correspondls whth the point closest to the arigh. You are given more paints to glot thaw you feod.) Supposie there are 9 firms in this industry, each of which has the cost curves previausiy shom. graph to indicate the shert-run equavium price and eqantity ho chs markes. Note: Dailhed drop lines will automatically extend to both axes. 6. Deriving the short-run supply curve The following graph plots the marginal cost (MC) curve, average total cost (ATC) curve, and average variable cost (AVC) curve for a firm operating in the competitive market for snapback hats. 90 70 COSTS (D) 8 8 8 8 30 20 10 a O MC 4 10 20 60 95 ATC Price (Dollars per snapback) 15 20 35 45 AVC D O 70 00 QUANTITY (Thousands of snapback) For every price lave given in the following table, use the graph to determine the profit-maximizing quantity of snapbacks for the firm. Further, select whether the firm will choose to produce, shut down, or be indifferent between the two in the short run. (Assume that when price exactly equals average variable cost, the firm is indifferent b t between producing zero snapbacks and the profit-maximizing quantity of snapbacks.) Lastly, determine whether the firm will earn a profit, incur a loss, or break even at each price 120 Quantity (Snapbacks) Produce or Shut Down? Profit or Loss?
On the following graph, use the orange points (square symbol) to plot points along the portion of the firm's short-run supply curve that corresponds to prices where there is positive output. (Note: For the graphing tool to grade correctly, you must plot the points in order from left to right, starting with the point closest to the origin. You are given more points to plot than you need.) 100 90 8 00 PRICE Dolars per snapback 8 8 10 4 100 Suppose there are 9 firms in this industry, each of which has the cost curves previously shown. = On the following graph, use the orange points (square symbol) to plot points along the portion of the industry's short-run supply curve that corresponds to prices where there is positive output. (Note: For the graphing tool to grade correctly, you must plot these points in order from left to right, starting with the point closest to the origin. You are given more points to plot than you need.) Next, place the black point (plus symbol) on the graph to indicate the short-run equilibrium price and quantity in this market. Note: Dashed drop lines will automatically extend to both axes. a PRICE (Dolars per pack 2 70 60 50 20 4 10 18 0 QUANTITY (Thousands of spac 4 Demand Fim's Short-Run Supply 90 183 278 360 453 543 423 728 813 900 QUANTITY (Thousands of snapback At the current short-run market price, firms will Industry's Short-Run Supply Equilibrium in the short run. In the long run,
Transcribed Image Text:On the following graph, use the orange points (square symbol) to plot points along the portion of the firm's short-run supply curve that corresponds to prices where there is positive output. (Note: For the graphing tool to grade correctly, you must plot the points in order from left to right, starting with the point closest to the origin. You are given more points to plot than you need.) 100 90 8 00 PRICE Dolars per snapback 8 8 10 4 100 Suppose there are 9 firms in this industry, each of which has the cost curves previously shown. = On the following graph, use the orange points (square symbol) to plot points along the portion of the industry's short-run supply curve that corresponds to prices where there is positive output. (Note: For the graphing tool to grade correctly, you must plot these points in order from left to right, starting with the point closest to the origin. You are given more points to plot than you need.) Next, place the black point (plus symbol) on the graph to indicate the short-run equilibrium price and quantity in this market. Note: Dashed drop lines will automatically extend to both axes. a PRICE (Dolars per pack 2 70 60 50 20 4 10 18 0 QUANTITY (Thousands of spac 4 Demand Fim's Short-Run Supply 90 183 278 360 453 543 423 728 813 900 QUANTITY (Thousands of snapback At the current short-run market price, firms will Industry's Short-Run Supply Equilibrium in the short run. In the long run,
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