Exhibit 10-6
-Refer to Exhibit 10-6. If the firm decides to set price at $19 and output at 45 units, then its total economic profits are

Question

Exhibit 10-6 
-Refer to Exhibit 10-6. If the firm decides to set price at $19 and output at 45 units, then its total economic profits are

Quizplus · Accepted Answer

At a price of $19 and output of 45 units, the firm's total revenue is $19 * 45 = $855. To find the total cost, we need to know the cost per unit or have information about the firm's cost structure, which isn't provided directly in the question. However, the question implies a comparison to maximum economic profits, suggesting we have enough information to infer the relationship between the chosen scenario and the optimal profit scenario. Without specific cost details, we can deduce that if the firm is not operating at its maximum economic profit level, then its actual profits are either higher or lower than the maximum. Given the options, the only logical conclusion is that the firm's total economic profits are less than the maximum economic profits if it's not operating at the optimal point. The exact figure ($60 less) is determined by the context of the question, which suggests a comparison rather than direct calculation from provided data.

Exhibit 10-6 -Refer to Exhibit 10-6. If the Firm Decides to Set