14.5 Business Application: Tem.* Rent. and Pro., MEnbepreneurat Suppose, as In exemise 14.4, that...

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14.5 Business Application: Tem.* Rent. and Pro., MEnbepreneurat Suppose, as In exemise 14.4, that you are operating a hamburger restaurant that Is part °fa competitive Indust, Now you are also Me owner, and suppose throughout that the owner of a restaurant Is also one of the workers in the restaurant and collects Me same wage as other workers fa the Mne he/she puts into the business each week. (In addition, of course, the owner keeps any weekly profits) A. Again, assume MM.,. restaurants are using,. same hommbetic lensing re= to scale weekly llxed cost F. a. First, assume that all restaurant owners possess the same level of entrepreneural c. Draw dm long-run AC curve (for weekly hamburger imoduction) for a restaurant and Indicate how many weekly hambumers Me restaurant will sell and at ishat price assuming that the Industry Is In long-run equlliklum.
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David · Accepted Answer

14,4
Average costs= Total CostQuantity
=w.l+r.k+F
F (K , l)
=
v (Q)+F
Q
Costs
                  F                                                      ATC(weekly)
           
                                                                                                        Quantity
b.
             Price
                                                        Supply curve
                                                                    

                                                                    q*                                                         qty.
Price is chosen in order to maximise the area of the rectangle
       
c. The price of ordinary hamburgurs would change in as much our firm's exit affect the agrregate 
countries the supply curve shifts left.
d.

14.5 Business Application: Tem.* Rent. and Pro., MEnbepreneurat Suppose, as In exemise 14.4, that you are operating a hamburger restaurant that Is part °fa competitive Indust, Now you are also Me...

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