What will happen because it is out of quilibrium

Reference no: EM13183588

In the beach city of Santa Barbara, California, there are seven bathing suit stores, each with the same schedule of costs and each facing an identical demand curve. Swim N Style is a typical store:

suits sold (per hour) price total cost

1 $68 $70

2 66 80

3 64 85

4 62 90

5 60 100

6 58 115

7 56 136

8 54 164

9 52 200

10 50 245

a) Calculate total revenue, marginal revenue, marginal cost, and average cost at each level of sales fo the store.

b) If Swim N Style is a profit maximizer, what number of suits will it sell per hour? What will its price and profit be?

c) How can you tell what the bathing suit market in Santa Barbara is not in long-run equilibrium? What will happen because it is out of quilibrium?

Reference no: EM13183588

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