Question
In December of 2019, the price for airline travel was the P 0 , the price you depicted in your answer to Question 1. Using
In December of 2019, the price for airline travel was the P0, the price you depicted in your answer to Question 1.
- Using the graphs of AVC, ATC, and MC, show this original price, P0, on this graph with$on the vertical axis and lower-caseq(firm output) on the horizontal axis. You should assume that this December 2019 priceP0is higher than the minimum point of the ATC you drew on your graph.
- Graphically indicate the profit maximizing outputq0for this typical firm and explain how you determined this output.
- Why does it not make sense for the firm to produce either more or less than the profit maximizing outputq0that you've determined? Please explain.
Please upload a single Microsoft Word or PDF file with agraphand anarrative responsewhere indicated as an answer to this question.
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Economics
Authors: Campbell R. McConnell, Stanley L. Brue, Sean M. Flynn
18th edition
978-0077413798, 0-07-336880-6, 77413792, 978-0-07-33688, 978-0073375694
