1> D 6
The corresponding quantity on the demand curve for a price of $4 is 6 units.
2> A
Since it is an increasing cost industry, the average cost to produce more units will be higher, thus it would be more than $2 but it will be less than $4 because there will be more firms who will enter the market which will drive down the price in the long run.
3> C
We can see that ATC is the lowest at 30 units and then it starts increasing and it is more than $14 after 40 units. So, somewhere between 30 and 40 mugs, the profit will be maximum.
4> B
At a quantity of 8 units, clearly ATC is more than the corresponding price of $2, so he will make economic loss.
pleaser answer all four questions. thank you. 10 MC 8 Price and costs (dollars per unit)...
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