Use the accompanying graph, which shows the marginal cost and average total cost curves for the shoe

Question:

Use the accompanying graph, which shows the marginal cost and average total cost curves for the shoe store Zapateria, a perfectly competitive firm.

a. How many pairs of shoes will Zapateria produce if the market price of shoes is $70 a pair?

b. What is the total profit Zapateria will earn if the market price of shoes is $70 a pair?

c. Should Zapateria expect more shoe stores to enter this market? Why or why not?

d. What is the long-run equilibrium price in the shoe market assuming it is a constant-cost industry? image text in transcribed

Step by Step Answer:

Related Book For answer-question

Microeconomics

ISBN: 9781260507140

11th Edition

Authors: David Colander

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Question Posted: Mar 14, 2024 04:01 AM

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Use the accompanying graph, which shows the marginal cost and average total cost curves for the shoe

Question:

Price per pair $100 90 80 MC 70 ATC 60 50 40 30 20 10 0 100 200 300 400 500 600 Pairs of shoes

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