Question
Suppose a firm's total variable costs are given by TVC (g)-4-2, and it has a fixed cost of 194 of which 144 is avoaidable.
Suppose a firm's total variable costs are given by TVC (g)-4-2, and it has a fixed cost of 194 of which 144 is avoaidable. We want to find the firm's supply. Let's first find the minimum of the average variable and avoidable costs. This will allow us to find the price below which the firm will not produce. Remember for decisionmaking only the avoidable fixed cost matter. This occurs are q The price at which the firm just breaks even is P- The firm's supply, then is q for PS and for P> Please give the supply in terms of upper case P and please use fractions.
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