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( 1 5 % ) Assume a competitive firm incurs fixed costs and increasing marginal cost. ( straight line ) ( a ) ( 1
Assume a competitive firm incurs fixed costs and increasing marginal cost. straight line
a Graphically illustrate the case in which the firm will make a shortrun decision to shut down. Please label demand, MR MC ATC, AVC in the figurePlease employ Ushaped ATC and AVC to answer this question
b Based on your figure, please indicate the area representing the profit loss for the firm if the firm did not shut down and the profit loss if the firm did shut down. You may need to properly label your figure to answer this question.
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