(22 points) Suppose a competitive firm maximizes its profits in the short run. (1) (6 points) Explain why the short-run

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answerhappygod
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(22 points) Suppose a competitive firm maximizes its profits in the short run. (1) (6 points) Explain why the short-run

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(22 points) Suppose a competitive firm maximizes its profits in
the short run.
(1) (6 points) Explain why the short-run profit maximization in
output perspective is a two-stage optimization problem, and derive
the first-stage function.
(2) (8 points) Mathematically derive the first-order condition and
graphically illustrate its geometric meaning.
(3) (8 points) Mathematically derive the second-order condition and
graphically illustrate its geometric meaning.
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