In the short run, at a market price of $50 per pan, this firm will choose to produce 37,500pans per day.On the preceding graph, use the blue rectangle (circle symbols) to shade the area representing the firm's profit or loss if the market price is $50 andthe firm chooses to produce the quantity you already selected.Note: In the following question, enter a positive number, even if it represents a loss.The area of this rectangle indicates that the firm'swould be $thousand per day in the short run. 3. Profit maximization in the cost-curve diagramSuppose that the market for frying pans is a competitive market. The following graph shows the daily cost curves of a firm operating in this marketHint: After placing the rectangle on the graph, you can select an endpoint to see the coordinates of that point.10090Profit or Loss8070ATC60504030AVC20MC105101520253035404550QUANTITY (Thousands of pans per day)In the short run, at a market price of $50 per pan, this firm will choose to produce 37,500pans per day.PRICE (Dollars perpan)

The objective of the firm is to maximize its profit level. A firm earns profit if its revenue…

In the short run, at a market price of $50 per pan, this firm will choose to produce 37,500 pans per day. On the preceding graph, use the blue rectangle (circle symbols) to shade the area representing the firm's profit or loss if the market price is $50 an the firm chooses to produce the quantity you already selected. Note: In the following question, enter a positive number, even if it represents a loss. The area of this rectangle indicates that the firm's would be s | thousand per day in the short run.

In the short run, at a market price of $50 per pan, this firm will choose to produce 37,500 pans per day. On the preceding graph, use the blue rectangle (circle symbols) to shade the area representing the firm's profit or loss if the market price is $50 an the firm chooses to produce the quantity you already selected. Note: In the following question, enter a positive number, even if it represents a loss. The area of this rectangle indicates that the firm's would be s | thousand per day in the short run.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter7: Production, Costs, And Industry Structure

Section: Chapter Questions

Problem 37CTQ: How would an improvement in technology, like the high-efficiency gas turbines or Pirelli tire plant,...

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1. A firm has three different production facilities, all of which produce the same product. Whilereviewing the firm’s cost data, Ron, a manager, discovered that one of the plants has a higher averagecost than the other plans and suggests closing this plant. Another manager, Jack, notes that the high-cost plant has high fixed costs but that the marginal cost in this plant is lower than in the other plants.He says that the high-cost plant should not be shut down but should expand its operations. Who isright? 2. Should a firm shut down if its weekly revenue is $1,000, its variable cost is $500, and its fixed cost is$800, of which $600 is avoidable if it shuts down? Explain.