Multiple Choice
A multi- plant firm has three plants and, at its current production levels, the marginal cost of production at each of the three plants is $2. If the firm is perfectly competitive and the market price of its product is $6, which of the following is true?
A) The firm should decrease output at each of the plants to maximize profit.
B) The firm should increase output at each of the plants to maximize profit.
C) The firm is producing the profit- maximizing total output.
D) The firm should exactly triple output in each of the plants to maximize profit.
Correct Answer:
Verified
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