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4. Profit maximization in the cost-curve diagram Aa Aa Consider a perfectly competitive market for teddy bears. The followingIn the short run, at a market price of $18 per bear, this firm will choose to produce bears per day. On the previous graph, u

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k thousand perfectly competitie fiam will produce at the output level where P=Mc (in order to max. 16 at P: $18 Q = 45 thousa

PRICE (Dollars per bear) 20 Profit or Loss MC p* Profit 16 ATC 12 AVC 8 4 0 10 20 30 40 Q* 50 60 OUTPUT (Thousands of bears)

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