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Suppose that fims in the market for blenders are price takers. The following graph shows the dally marginal cost (SMC), average cost (SAC), and average

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Suppose that fims in the market for blenders are price takers. The following graph shows the dally marginal cost (SMC), average cost (SAC), and average variable cost (AVC) of a firm operating in this market in the short run. For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the proft or ioss if it produces at that quantity, using the data from the preceding graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down, it will produce. (Hint: You can select the purple points [diamond symbols] on the previous graph to see precise information on average variable cast.) If the fim shuts down, it must incur its fixed costs (FC) in the short run. In this case, the frm's fxed cost is $1,600,000 per day. In other words, if it shuts down, the firm would suffer losses of $1,600,000 per day until its fixed costs end (such as the expiration of a building lease). This firm's shutdown price - that is, the price below which it is optimal for the firm to shut down-is: per blender

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