25. Ralph opens a small shop selling bags of trail mix. The price of the mix is $5, and the market for trail mixis very competitive.When the price is $5, how much profit will Ralph make?
Incorrect. At a price of $5, what quantity will Ralph produce? Now find the average cost ofproduction at that quantity. Profit is (P – AC)
b.$14Incorrect. At a price of $5, what quantity will Ralph produce? Now find the average cost ofproduction at that quantity. Profit is (P – AC)
Incorrect. At a price of $5, what quantity will Ralph produce? Now find the average cost ofproduction at that quantity. Profit is (P – AC)

26. Ralph opens a small shop selling bags of trail mix. The price of the mix is $5, and the market for trail mixis very competitive.If all other sellers of trail mix have the same marginal and average costs as Ralph, what should he expect tohappen to the number of competitors in the future? What will the price of trail mix be in the long run?a.Ralph should expect more competitors and the price of trail mix will fall to $1.
c.
Ralph should expect the number of competitors to remain the same and the price of trail mix willremain at $5.Incorrect. With the price at $5, Ralph will be making positive profits. What happens in competitivemarkets with positive profits? How does this affect the price of the good?d.Ralph should expect fewer competitors and the price of trail mix will rise to $8.Incorrect. With the price at $5, Ralph will be making positive profits. What happens in competitivemarkets with positive profits? How does this affect the price of the good?