Economics For Today
Economics For Today
10th Edition
ISBN: 9781337613040
Author: Tucker
Publisher: Cengage Learning
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Chapter 8, Problem 4SQ
To determine

 The most-profitable level of output of the firm at price OB.

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An ice cream producer has fixed costs of $70,000 per month, and it can produce up to 15,000 ice cream tubs per month. Each tub costs $10 in the market while the producer faces variable costs of $3 per tub. a. What is the economic breakeven level of production? b.Calculate the ice cream producer's monthly profits at full capacity. What would happen to the monthly profits if another ice cream producer entered the market, driving the price of ice cream tubs down to $7 per unit?
Please do a,b,c,d,e
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