3. At its current level of production, a firm in a competitive market receives $10 for each unit it produces. At the market price of $10 per unit, the firm's profit-maximizing quantity is 500. At this level of production, the firm's average total cost is $8. a. Solve for the firm's economic profits. (2 points) b. In the long run, will firms enter or exit the market. Why? (2 points) c. TWO POSSIBLE BONUS POINTS: Explain how the market reaches the long-run equilibrium. Use graphs to illustrate your answer. 4. Refer to the following graph: Price and Cost ATC $50 MR $40 $37 20 25 Quantity a. What is the total revenue for a firm following the profit-maximizing rule? (1 point1) b. What is the total cost for a firm following the profit-maximizing rule? (1 point) c. What is the firm's economic profit? (1 point)1. Katrina owns a dress shop. Her total explicit and implicit costs are $600,00 per year, and her explicit fixed costs are $150,000 per year. Katrina could otherwise earn $80,000 in her next best alternative line of business or employment. Each dress sells for $400. This year, Katrina sold 2,000 dresses. a. Solve for Katrina's economic profit. (2 points) b. Solve for Katrina's average fixed cost. (2 points) c. Solve for Katrina's average variable cost. (2 points) d. Solve for Katrina's average total cost. (2 points) 2. Complete the following cost table: (10 points) Quantity Total Fixed Cost | Total Variable Cost | Total Cost | AFC | AVC | ATC | MC 0 500 500 500 200 2 800 3 875 75 925 5 100