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Explain in what sense actual business enterprises

1) Explain in what sense actual business enterprises differ from the textbook neoclassical models as discussed in Dean, Erik et al. 2016. Principles of Microeconomics: Scarcity and Social Provisioning. OpenStax Economics, Principles of Economics. OpenStax CNX. May 18, 2016.

Consider a new business that invests $20 million into a plant to manufacture loaves of bread. The market for bread is say around $100 million and the new firm expects that it will be able to obtain a market share of around 5%. At that level of production, its per-unit costs will be $2 per loaf. Let us say that it targets a 20% return on its investment. What should the price of a loaf of bread be? Use the principle of full-cost pricing.

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