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5. Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1 per

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5. Karen runs a print shop that makes posters for large companies. It is a very competitive business. The market price is currently $1 per poster. She has xed costs of $250. Her variable costs are $1500 for the rst thousand posters, $1200 for the second thousand, and then $800 for each additional thousand posters. a. What is her AFC per poster (not per thousand!) if she prints 1000 posters? 2000? 10,000? (5 marks) b. What is her AVC per poster if she prints 1000? 2000? 10,000? (5 marks) c. What is her ATC per poster if she prints 1000? 2000? 10,000? (5 marks) (1. If the market price fell to 90 cents per poster, would there be any output level at which Karen would not shut down production immediately (assuming maximum production at 10,000 posters)? (5 marks) [Total: 20 marks]

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