Finance / Economics

David Goldberg, owner of Goldberg's Bagels in Roswell, Atlanta, specializes in fresh, New York-style bagek. Despite intense competition in the expanding neighborhood, David remains confident in his product. To help his som Jacob, a sophomore studying microeconomics at Emory University, David collected data on local bagel shops, including each establishment's maxim um daily production capacity, variable cost per bagel, and monthly fixed costs. Max. daily production Variable cost Fixed cost (bage b] (S/bagel] S/month Bage 6- R- Us 250 0.45 1500 Barry's Bagel 25 0 0.60 2000 Mr. Bagel 4010 0.65 2500 Goldberg's Bagels 3010 0.55 1800 Hot Bagel 200 0.50 1500 Bagel Hut 10 0 0.65 1200 The Bagel Bakery 350 0.75 2800 The daily demand schedul for bagel in the Roswell neighborhood is as follows: Price Quantity [S per bagel] 0.90 400 0.85 500 0.80 600 0.75 700 0.70 800 0.65 900 0.60 1000 0.55 1 100 0.50 1200 a. Using the data provided, construct the local supply schedule for bagels in the highly com- petitive Roswell market. [3 points] b. Determine the equilibrium price and quantity in the Roswell bagel market. [3 points] c. David's bing-time friend Saul is considering opening a new NY-style bagel shop in the neighborhood ("Better Call Saul]. Saul's prospective costs include a monthly fixed cost of $2,200, a maximum daily production capacity of 300 bagels, and a variable cost of 55 cents per bagel. Based on the equilibrium price, should Saul enter the highly competitive bagel market in Roswell? Explain your reasoning. [3 points]