Instructions – PLEASE READ THEM CAREFULLY

• The Assignment must be submitted on (WORD format only)
• Students are advised to make their work clear and well presented, marks may be reduced for poor presentation.
• Students must mention question number clearly in their answer.
• Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
• All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).

• Consider the long-run production of Bicycles. The cost of the indivisible inputs used in the production of bicycles is $6000 per day. To produce one Bicycle per day, the firm must also spend a total of $80 on other inputs-labor, materials, and other capital. For each additional bicycle, the firm incurs the same additional cost of $80.
• Draw a graph of perfectly competitive market and explain equilibrium of the firm by choosing output level at which

• Compute the average cost for 30 bicycles, 60 bicycles, 100 bicycles, and 300 bicycles.
• Draw the long-run average cost curve for 30,60,100 and 300 bicycles per day.

• P=MC=MR and Firm is making zero economic profit
• P=MC=MR and Firm is making a loss

Explain shut down rule with the help of graph

the question file attached.