4. Profit maximization in the cost-curve diagram 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. 50 45 Profit or Loss 40 35 30 ATC PRICE (Dollars per romper) 25 20 15 AVC 10 MC 0 2 4 6 10 12 14 16 18 20 QUANTITY (Thousands of rompers per day)In the short run, given a market price equal to $15 per romper, the firm should produce a daily quantity of V 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. 2,000 On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or lo firm given the market price of 7,500 $15 and the quantity of production from your previous answer. 8,000 Note: In the following question, enter a positive number regardless of whether the firm earns a profit or in 10,000 The rectangular area represents a short-run of $ thousand per day for the firm.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 s answer. loss Note: In the following question, enter a posit profit ber 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.5. Profit maximization and shutting down in the short run The following graph plots daily cost curves for a firm operating in the competitive market for rompers. 50 45 40 35 30 ATC PRICE (Dollars per romper) 25 20 15 10 AVC MC 2 4 6 8 10 12 14 16 18 20 QUANTITY (Thousands of rompers)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 romper) (Rompers) (Dollars) (Dollars) (Dollars) (Dollars) 12.50 135,000 27.50 135,000 45.00 135,000 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 $135,000 per day. In other words, if it shuts down, the firm would suffer losses of $135,000 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 romper.2,000 4,500 7,500 Using the following table, for e level, calculate the optimal quantity of units for the firm to produce. Using the data from the graph to 10,000 determine the firm's total va calculate the profit or loss associated with producing that quantity. Assume that if the firm is indifferent between producing and shut 12,000 it will choose to produce. (Hint: Select purple points [diamond symbols] on the graph to receive exact average variable cost information.) 16,000 Price y Total Revenue Fixed Cost Variable Cost Profit 18,000 (Dollars per romper) 'S) (Dollars) (Dollars) (Dollars) (Dollars) 12.50 135,000 27.50 135,000 45.00 135,000 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 $135,000 per day. In other words, if it shuts down, the firm would suffer losses of $135,000 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 romper.Price Quantity Total Revenue Fixed Cost Variable Cost Profit (Dollars per romper) (Rompers) (Dollars) (Dollars) (Dollars) (Dollars) v E I I I I If the rm shuts down, it must incur its xed costs (FE) in the short run. In this case, the firm's xed 35,000 per day. In other words, if it $27.50 $45.00 This firm's shutdown pricethat is, the price below which it is optimal for the rm to shut downis v per romper. shuts down, the rm would suffer losses of $135,000 per clayr until its xed costs end (such as the ex: a building lease}