The S.G. Allen Fabric Company sells cotton fabric in a perfectly competitive market at a price of $4 per yard. Its marginal cost, average variable cost, and average total cost curves can be seen below: Find the profit-maximizing level of output and mark it q*. Shade in the area of profit earned by the firm. Is it positive or negative? How do you know?

Question

The S.G. Allen Fabric Company sells cotton fabric in a perfectly competitive market at a price of $4 per yard. Its marginal cost, average variable cost, and average total cost curves can be seen below:  Find the profit-maximizing level of output and mark it q*. Shade in the area of profit earned by the firm. Is it positive or negative? How do you know?

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The Answer of The S.G. Allen Fabric Company sells cotton fabric in a perfectly competitive market at a price of $4 per yard. Its marginal cost, average variable cost, and average total cost curves can be seen below:  Find the profit-maximizing level of output and mark it q*. Shade in the area of profit earned by the firm. Is it positive or negative? How do you know?

The SG Allen Fabric Company Sells Cotton Fabric in a Perfectly