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Consider a small firm that provides tours to visitors in a large city. The market for tours is perfectly competitive in the city. The firm
Consider a small firm that provides tours to visitors in a large city. The market for tours is perfectly competitive in the city. The firm has no fixed costs, so if it does not provide any tours in a day, it has a cost of zero. The daily cost of providing tours is listed in the table below. Cost of providing tours Total Tours Cost of Providing Tours 1 $27 2 $51 3 $72 4 $90 5 $105 6 $117 7 $126 8 $138 9 $153 10 $171 11 $192 12 $216 1st attempt Part 1 (1 point) Suppose the price of a tour is $21. If the firm is a profit-maximizing firm, it would provide a number of tours such that its marginal cost equals $ . Part 2 (2 points) The lowest number of tours that the firm could provide, for the marginal cost to equal what you answered in Part 1, is units. The highest number of tours that the firm could provide, for the marginal cost to equal what you answered in Part 1, is units. Part 3 (1 point) You may assume that the tour provider will provide a tour even if it breaks even
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