The following are cost data for four different size plants available to a competitive producer: Dutpui AC1 AC2 AC3 AC4 50 SSE! $95 $12!?! $150
100 75 SD 100 120
l 51] 65 ED 75 10!]
200 T5 8D 55 15 2511 90 100 SD 90

1)a) If the market price of this product is $80, which is the best size of plant?

A. The plant represented by AC1.

B. The plant represented by AC2.

C. The plant represented by AC3.

D. The plant represented by AC4.

E. It depends on whether it is the short run or the long run.

b) What will be the price of the product in the long run?

A. $55.

B. $70.

C. $65.

D. $75.

E. Cannot be determined.

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