The following graph represents the situation of Marguerite's Caps, a firm selling caps in the perfectly competitive

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The following graph represents the situation of Marguerite's Caps, a firm selling caps in the perfectly competitive cap industry:

Price and cost (dollars per cap) MC ATC AVC $11.00 MR 9.00 6.00 Quantity (caps per day) 80 100

a. How much output should Marguerite produce to maximize her profits?
b. How much profit will she earn?
c. Suppose Marguerite decides to shut down. What would her loss be?

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Economics

ISBN: 978-0134106243

6th edition

Authors: R. Glenn Hubbard

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Question Posted: Nov 01, 2017 07:12 AM

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The following graph represents the situation of Marguerite's Caps, a firm selling caps in the perfectly competitive

Question:

Price and cost (dollars per cap) MC ATC AVC $11.00 MR 9.00 6.00 Quantity (caps per day) 80 100

Step by Step Answer:

a To maximize profit Marguerite should produce at the level of output in which MR ...View the full answer

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