3. Profit maximization and shutting down In the snort run The following graph plots daily cost curves for a firm operating in the competitive market for instant pots. (? 100 g ATC PRICE (Dollars per instant pot ) 8 8 8 8 8 2 AVC 5 10 15 20 26 30 35 40 45 50 QUANTITY (Thousands of instant pots) Using the following table, for each price level, calculate the optimal quantity of units for the firm to produce. Using the data from the graph to determine the firm's total variable cost, calculate the profit or loss associated with producing that quantity. Assume that if the firm is indifferent between producing and shutting down, it will choose to produce. (Hint: Select purple points [diamond symbols] on the graph to receive exact average variable cost information.) Price Quantity Total Revenue Fixed Cost Variable Cost Profit (Dollars per instant pot) (Instant pots) ( Dollars) Dollars Dollars) (Dollars) 25.00 1,600,000 70.00 1,600,000 100.00 1,600,000 If the firm shuts down, it must incur its fixed costs (FC) in the short run. In this case, the firm's fixed cost is $1,600,000 per day. In other words, if it shuts down, the firm would suffer losses of $1,600,000 per day until its fixed costs end (such as the expiration of a building lease). This firm's shutdown price-that is, the price below which it is optimal for the firm to shut down-is per instant pot.6. Deriving the short-run supply curve The following graph plots the marginal cost (MC) curve, average total cost (ATC) curve, and average variable cost (AVC) curve for a firm operating in the competitive market for jumpsuits. (?) 100 ALL COSTS (Dollars) MC O 20 40 50 60 70 80 90 100 QUANTITY (Thousands of jumpsuits) For every price level given in the following table, use the graph to determine the profit-maximizing quantity of jumpsuits for the firm. Further, select whether the firm will choose to produce, shut down, or be indifferent between the two in the short run. (Assume that when price exactly equals average variable cost, the firm is indifferent between producing zero jumpsuits and the profit-maximizing quantity of jumpsuits.) Lastly, determine whether the firm will earn a profit, incur a loss, or break even at each price. Price Quantity Dollars per jumpsuit) (Jumpsuits) Produce or Shut Down? Profit or Loss? 15 20 25 55 70On the following graph, use the orange points (square symbol) to plot points along the portion of the firm's short-run supply curve that corresponds to prices where there is positive output. (Note: For the graphing tool to grade correctly, you must plot the points in order from left to right, starting with the point closest to the origin. You are given more points to plot than you need.] 100 Firm's Short-Run Supply 70 50 PRICE (Dollars per jumpsuit) 40 30 20 10 20 30 40 50 60 70 80 100 QUANTITY (Thousands of jumpsuits) Suppose there are 5 firms in this industry, each of which has the cost curves previously shown.Suppose there are 5 firms in this industry, each of which has the cost curves previously shown. On the following graph, use the orange points (square symbol) to plot points along the portion of the industry's short-run supply curve that corresponds to prices where there is positive output. (Note: For the graphing tool to grade correctly, you must plot these points in order from left to right, starting with the point closest to the origin. You are given more points to plot than you need.) Next, place the black point (plus symbol) on the graph to indicate the short-run equilibrium price and quantity in this market. Note: Dashed drop lines will automatically extend to both axes. 100 - Demand Industry's Short-Run Supply Equilibrium 50 PRICE (Dollars per jumpsuit] 50 100 150 200 250 300 350 400 450 500 QUANTITY (Thousands of jumpsuits) At the current short-run market price, firms will in the short run. In the long run