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Unformatted text preview: s. (d) 92 shirt s. The graph above shows the average and marginal cost curves for the Banner Textile Company. The company produces corduroy fabric, which it sells in a perfectly competitive market. The current market equilibrium price for corduroy is $50 a yard. Assuming the firm maximizes profit, (a) it will incur econ omic loss es in the shor t run. (b) it will shut dow n imm ediat ely. (c) it will earn zero econ omic profi t in the shor t run. (d) it will earn econ omic profi t in the shor t run. (e) it will The graph above shows the cost curves in the long run prevailing for a firm selling in a perfectly competitive market. When the industry is in longrun competitive equilibrium, (a) the mar ginal cost of prod uctio n will be $8. (b) the price of the prod uct will be $6. (c) the firm will earn $33 0 of econ omic profi t per day. (d) the firm will prod uce 100 units of outp ut per day...
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This note was uploaded on 03/20/2008 for the course EC 205 taught by Professor Hymen during the Spring '08 term at N.C. State.
 Spring '08
 Hymen

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