Principles of Macroeconomics|ECON 102|Trinity Western University
Suppose in a region each household produces either 1 pair of shoes or 1 gallon of milk per hour. One mile of round-trip travel takes 12 min. A firm produces shoes. The firm faces CRS in production and charges competitive price. a. What is the slope of net price curve? b. The market radius of the firm is 4 miles. What is the firm’s average cost of producing shoes?