Refer to the accompanying figure to answer the following questions.

-This firm
A) is in a competitive market.
B) can make a profit.
C) does not want to maximize profit.
D) cannot make a profit.
E) is not a monopolist because it is incurring a loss.

Question

Refer to the accompanying figure to answer the following questions.
 
-This firm
A) is in a competitive market. 
B) can make a profit. 
C) does not want to maximize profit. 
D) cannot make a profit. 
E) is not a monopolist because it is incurring a loss.

Quizplus · Accepted Answer

The firm is producing at a quantity where marginal cost is greater than marginal revenue, indicated by the point where the Marginal Cost (MC) curve intersects the Marginal Revenue (MR) curve. This means the firm is incurring a loss on each unit sold and is not able to cover its costs. Therefore, the firm cannot make a profit.

Refer to the Accompanying Figure to Answer the Following Questions