In the short run, given a market price equal to $15 per romper, the firm should produce a daily quantity ofOn the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of$15 and the quantity of production from your previous answer.Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss.thousand per day for the firm.The rectangular area represents a short-runrompers.of $ The following graph plots daily cost curves for a firm operating in the competitive market for rompers.Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates.(?)PRICE (Dollars per romper)5045403.5302015101050+02MCATCAVC4 6 812 14 16QUANTITY (Thousands of rompers per day)1018H20Profit or Loss

General Equilibrium Theory is a macroeconomic theory that makes sense of how supply and demand in an economy with many markets interact dynamically and eventually culminate in an equilibrium of prices. The theory expects that there is a gap between actual prices and equilibrium prices.A perfectly competitive firm will choose a level of output that is computed by the cross-section of the price line and MC curve. This means MC = P = 15, which occurs when Q = 8. At Q = 8, ATC is $30 and the price is $15, implying the firm is making a loss. In the short run at a market price of $15 per shirt, this firm will decide to produce 8000 shirts per day. The loss is (P - ATC)*Q = (15 - 30)*8000 = $120,000 The area of this rectangle shows that the firm’s loss would be $120,000 per day.

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In the short run, given a market price equal to $15 per romper, the firm should produce a daily quantity of rompers. On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of $15 and the quantity of production from your previous answer. Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss. The rectangular area represents a short-run of $ thousand per day for the firm.

In the short run, given a market price equal to $15 per romper, the firm should produce a daily quantity of rompers. On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of $15 and the quantity of production from your previous answer. Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss. The rectangular area represents a short-run of $ thousand per day for the firm.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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