-Refer to the graph above.If this firm were allowed to choose the profit-maximizing level of output,it would charge a price of
A) $11.50 per unit.
B) $9 per unit.
C) $8 per unit.
D) $5.50 per unit.
E) $2.50 per unit.

Question

-Refer to the graph above.If this firm were allowed to choose the profit-maximizing level of output,it would charge a price of
A) $11.50 per unit. 
B) $9 per unit. 
C) $8 per unit. 
D) $5.50 per unit. 
E) $2.50 per unit.

Quizplus · Accepted Answer

The profit-maximizing level of output is where marginal cost equals marginal revenue. From the graph, we can see that this occurs at an output of 4 units. At this output, the price is $11.50 per unit.

-Refer to the Graph Above