As Tren Dee Apparel’s chief executive officer, you decide to break into the competitive sweatshirt market. Use the information provided in this figure to answer the following questions concerning Tren Dee’s operations.
1. What is the equilibrium market price of sweatshirt?
2. What is the profit-maximizing level of output for Tren Dee (in thousands)?
3. At the profit-maximizing level of output, what is Tren Dee’s total revenue (in thousands of dollars)?
4. What is Tren Dee’s total cost (in thousands of dollars) at the profit maximizing level of output?
5. At the profit-maximizing level of output, are economic profits positive, negative, or zero?
6. You should shutdown Tren Dee’s sweatshirt operation if the market price falls below what dollar amount?
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