21. Use the accompanying graph, which shows the marginal cost and average total cost curves for the...
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21. Use the accompanying graph, which shows the marginal cost and average total cost curves for the shoe store Zapateria, a perfectly competitive firm. (LO13-4)
a. How many pairs of shoes will Zapateria produce if the market price of shoes is $70 a pair?
b. What is the total profit Zapateria will earn if the market price of shoes is $70 a pair?
c. Should Zapateria expect more shoe stores to enter this market? Why or why not?
d. What is the long-run equilibrium price in the shoe market assuming it is a constant-cost industry?
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