Wednesday, September 17th, 2008 | Author: admin
lowest price?
Jennifer operates a business in a perfectly competitive environment. The following table represents Jennifer’s costs of production.
QuantityFixed CostVariable CostTotal CostAverage Variable CostAverage Total CostMarginal Cost
0$120$0$120——
1$120$20$140$20.00$140.00$20
2$120$38$158$19.00$79.00$18
3$120$54$174$18.00$58.00$16
4$120$68$188$17.00$47.00$14
5$120$84$204$16.80$40.80$16
6$120$102$222$17.00$37.00$18
7$120$122$242$17.43$34.57$20
8$120$146$266$18.25$33.25$24
9$120$176$296$19.56$32.89$30
10$120$214$334$21.40$33.40$38
11$120$262$382$23.82$34.73$48
12$120$322$442$26.83$36.83$60
8.1. What is the lowest price at which Jennifer would be willing not to exit the industry in the long run?
Well, for the best edge on the market, Jennifer should turn to part time prostitution. This way, she meets all kinds of new possible clients, makes some money, and remembers how it feels to be a woman. That’s very important.
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