a. What do this firm's fixed costs equal? b. If this firm can sell its output for $10 per unit, then what is its maximum profit? c. If this firm can sell its output for $4 per unit, then what is its maximum profit? 6. Consider the figure and table below. 700 600 Fixed Variable Total 500 Labor Quantity Cost Cost Cost 1 16 $160 $80 400 $240 Total Cost ($) 2 40 $160 $160 $320 300 3 60 $160 $240 $400 200 - 4 72 $160 $480 Fixed $320 100 Cost 5 80 $160 $400 $560 ($160) 0+ 6 84 $160 $480 $640 0 10 20 30 40 50 60 70 80 90 82 $160 $560 $720 Output a. What is the marginal gain in output from increasing the number of barbers from 4 to 5 and from 5 to 6? Does it continue the pattern of diminishing marginal returns? b. Compute the average total cost, average variable cost, and marginal cost of producing 60 and 72 haircuts. Draw the graph of the three curves between 60 and 72 haircuts. Perfect Competition 7. Why will profits and losses for firms in a perfectly competitive industry trend towards vanishing in the long run? Why are economic profits 0 in the long run