[BUS 330 Midterm Exam Please complete the following questions. APA is NOT required. Please do NOT delete the questions; simply provide your answers below each question. Answers must be clear and complete. Consider the following aggregate supplyr and demand in a perfect competition market (market supply and demand) and a rm cost structure in the short run. m "c are m 5' as as 61'.) 6t) 55 55 50 50 45 45 40 40' 35 mo 35 so so 25 25 20 2|} 15 15 10 ll} 5 5 D u o O 2 4 6 3101214151820222d262330 U 20 40 60 30100120140160180200 Part 1: (26 pts) A) What are the market's equilibrium price and quantity? (5 pts) B) What is the rm's equilibrium price? (5 pts) C) What is the rm's cost (total cost, the variable cost, and xed cost)? (6 pts) D) What is the rm's average cost: {average total cost and average variable cost)? (5 pts) E) What is the rm's marginal cost? (5 pts) Part 2: Suppose the price falls to $40. (24 pts} A) Calculate the rm's total cost, total revenue, and prot. (12 pts) B) Should the rm operate at the new price level? Why? (12 pts) Part 3: Determine the shutdown point and calculate the rm's prot. Should the rm stay in the market at the shutdown point? Why? (25 pts) Part 4: The rm's board of directors has decided to provide their services to additional customers. They have to set up a new infrastructure. The rm has a low initial cost for setting up this infrastructure. Can they take advantage of economies of scale to provide their services to additional customers? Why? {25 pts)