For the first six questions, you will work with the attached table, which descri
ID: 1103860 • Letter: F
Question
For the first six questions, you will work with the attached table, which describes Pirelli's Bakery. Pirelli's Bakery is a profit-maximizing, competitive firm with no implicit costs.
2) What value should go in cell C?
3) What value should go in cell D?
4) What value should go in cell G?
5) If the market price is $21, how many cakes should Pirelli's Bakery sell?
6) Given your answers to the last several questions, if the market price is $21 Pirelli's Bakery will experience _______ in the short run, and assuming that Pirelli's is a typical firm, in the long run we expect _______________.
a) profits; firms to enter Quantity Fixed Cost Variable Total Cost AverageAverageAverage Marginal of Cakes Fixed Cost Cost VariableTotal Cost Cost Cost $13 $28 S64 $108 $38 $70 $110 4 $133 $185Explanation / Answer
1) value of B=45
2) value of C=108
3) value of D=12.5
4) value of G=27
5) If the market price is $21, 5 units of cakesPirelli's Bakery should sell.
6) Given your answers to the last several questions, if the market price is $21 Pirelli's Bakery will experience an economic profit in the short run, and assuming that Pirelli's is a typical firm, in the long run, we expect firms to enter.
Hence option a is correct answer and option a is profits; firms to enter.
Q FC VC TC AFC AVC ATC MC 1 25 13 38 13 2 25 28 53 D=12.5 15 3 25 B=45 70 F=23.33 17 4 A=25 64 89 19 5 25 85 110 21 6 25 108 83 E=18 23 7 25 133 C=108 25 8 25 160 185 G=27