A perfectly competitive firm sells its good for $24. If marginal cost is three times the quantity produced, how much does the firm produce? Why?
multiple choice
Assuming perfect competition, the firm is producing where MR = MC = P. Since price is $24, MR is $24. If MC is 3 times the quantity, it is producing 8 units.
Assuming perfect competition, the firm is producing where MR = MC. If the price is $24 and MC is three times the quantity, it is producing 72 units.
Assuming perfect competition, the firm is producing where MC is twice MR. If the price is $24, then MC is $48. This means that the firm is producing 16 units.
Assuming perfect competition, there is not enough information to determine how much the firm is producing.