-If a marginal cost pricing rule is imposed on the firm in the figure above, the firm's economic profit is
A) zero.
B) $1,000.
C) -$7,200.
D) $320.

Name: -If a marginal cost pricing rule is imposed on the firm in the figure above, the firm's economic profit is A) zero. B) $1,000. C) -$7,200. D) $320.
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Question

-If a marginal cost pricing rule is imposed on the firm in the figure above, the firm's economic profit is
A) zero. 
B) $1,000. 
C) -$7,200. 
D) $320.

Quizplus · Accepted Answer

A marginal cost pricing rule means the firm sets its price equal to marginal cost. This often results in a loss if the price is below average total cost, leading to an economic profit of -$7,200.

-If a Marginal Cost Pricing Rule Is Imposed on the Firm