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Q. A perfectly competitive firm is currently maximizing profits. Marketplace demand for the firm's production increases. Briefly summarize Illustrate what happens in the marketplace. Express Illustrate what will happen to this firm's production (also most importantly why) as a result of that change. Express Illustrate what will happen also why to the firm's average fixed costs, marginal costs, average costs also profits as the firm makes its choices. Emphasize why every type of individual cost does or does not change as the firm changes its level of production. Elucidate your reasoning. Focus on the reasoning as to why the changes in costs also production occur. That is, why was the firm producing where it was producing, why does the firm change its output also then why do costs change as a result of the change in output. End with why the firm stops changing its production.
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