The diagram represents a perfectly competitive firm that faces a demand curve d. Answer the following questions.
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Question:
- The diagram represents a perfectly competitive firm that faces a demand curve d. Answer the following questions. Show all calculations. (25 points)
- a. From the diagram, how many units should this firm produce to maximize profit? (5pt)
- b. From the diagram data, calculate the firm’s total profit. (5pt)
- c. Assuming no changes in the costs of production, in the long run, how much will this firm produce, and at what price? (5pt)
- d. From the diagram, at what price will this firm break even? (5pt)
- e. From the diagram, at what price should this firm shut down? (5pt)
Related Book For
Microeconomics
ISBN: 978-0321866349
14th canadian Edition
Authors: Christopher T.S. Ragan, Richard G Lipsey
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