In the short run, the firm will produce \( \qquad \) units of output to maximise pr and will make an economic profit equal to \( \qquad \) . A) 20 units; zero. B) 22 units; zero. C) 20 units; R50. D) 22 units; R55
Added by Craig C.
Close
Step 1
In the short run, a firm maximizes profit by producing the quantity of output where marginal cost (MC) equals marginal revenue (MR). From the graph, this occurs where the MC curve intersects the MR curve. Show more…
Show all steps
Your feedback will help us improve your experience
Rashmi Sinha and 70 other Microeconomics educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Key Concepts
Recommended Videos
A representative firm with short-run total cost given by TC = 50 + 2q + 2q^2 operates in a competitive industry where the short-run market demand and supply curves are given by QD = 1,410 - 40P and QS = -390 + 20P. Its short-run profit maximizing level of output is A. 0 units. B. 1 unit. C. 2 units. D. 5 units. E. 7 units.
Haricharan G.
Suppose that a firm in monopolistically competitive market is producing 30 units of output. At this level of production, the firm charges $50 per unit. Its marginal cost is $24 and marginal revenue is $24, and average cost is $20 per unit. Given this information, in the long run you would expect a. firms to exit the market. b. price to increase. c. firms to maintain their current output and price. d. firms to enter the market
Azat N.
A firm is producing 20 units with an average total cost of $\$ 25$ and a marginal cost of $\$ 15 .$ If it were to increase production to 21 units, which of the following must occur? a. Marginal cost would decrease. b. Marginal cost would increase. c. Average total cost would decrease. d. Average total cost would increase.
Juan N.
Recommended Textbooks
Principles of Economics
Principles of Microeconomics for AP® Courses
Economics
Watch the video solution with this free unlock.
EMAIL
PASSWORD