Please do not copy from any other websites, thank you. (b) Suppose that the price at which Sophie can sell readymade dress is $25 perdress:i. In the short run, should she produce or shut down? Draw a graphaccordingly and explain your answer.ii.In the long run will she earn a profit/loss? Calculate and draw a graphaccordingly. Sophie's Boutique provides readymade dresses, under a perfectly competitivemarket. Sophie's sewing machinery costs $200 and is the only fixed input. Hervariable cost consists of the wages paid to the tailor and the sewing materials. Thetotal variable cost per day associated with each level of output is provided in thefollowing table below:Quantity ofDress'sTotal VariableCost ($)10200203003048040700501000

Shutdown point for a firm corresponds to the production point where the average revenue from…

(b) Suppose that the price at which Sophie can sell readymade dress is $25 per dress: i. In the short run, should she produce or shut down? Draw a graph accordingly and explain your answer. ii. In the long run will she earn a profit/loss? Calculate and draw a graph accordingly.

(b) Suppose that the price at which Sophie can sell readymade dress is $25 per dress: i. In the short run, should she produce or shut down? Draw a graph accordingly and explain your answer. ii. In the long run will she earn a profit/loss? Calculate and draw a graph accordingly.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter7: Proudction Costs

Section: Chapter Questions

Problem 9SQP

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