Dollars P P₂ P₁ 0 ******** MC Q₁ Q₂QzQ4 Q5 Quantity ATC AVC -MR₂ -MR₂ -MR₁ Refer to the above diagram. All data are for the short run. Which of the following sta correct? O The firm will produce an output of Q1 when price is P1. The firm will earn positive economic profits when price is at P2. O Average fixed cost is P3 - P1 at output Q1. O At price P1, the firm will close down.

Dollars P P₂ P₁ 0 ******** MC Q₁ Q₂QzQ4 Q5 Quantity ATC AVC -MR₂ -MR₂ -MR₁ Refer to the above diagram. All data are for the short run. Which of the following sta correct? O The firm will produce an output of Q1 when price is P1. The firm will earn positive economic profits when price is at P2. O Average fixed cost is P3 - P1 at output Q1. O At price P1, the firm will close down.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 21P

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