Cool-Aire Corporation manufactures a line of room air conditioners. Its breakeven sales level is 33,000 units. Sales are approximately normally distributed.
Expected sales next year are 40,000 units with a standard deviation of 4,000 units.
1. Determine the probability that Cool-Aire will incur an operating loss.
2. Determine the probability that Cool-Aire will operate above its break-even point.
3. Assume that a firm in a perfectly competitive industry has the following total cost schedule:

a. Calculate a marginal cost and an average cost schedule for the firm.
b. If the prevailing market price is $17 per unit, how many units will be produced and sold? What are profits per unit? What are total profits?
c. Is the industry in long-run equilibrium at this price?