Microeconomics
5th Edition
ISBN: 9781319098780
Author: Paul Krugman, Robin Wells
Publisher: Worth Publishers
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Chapter 12, Problem 4P
To determine
Bob’s break-even
Concept introduction:
Break-even price:
The break-even point is the point at which Blu-ray company’s revenues even its expenses for a certain time period. For a perfectly competitive firm, break-even output occurs where price is equal to
Shut-down price:
The shut-down point is the point at which Blu-ray company’s total revenue is equal to its variable cost. At this point, there is neither incentive to continue production, nor incentive to limit it.
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