Exhibit 24-2

-Refer to Exhibit 24-2.Total cost at the profit-maximizing quantity of output is the

Question

Exhibit 24-2
 
-Refer to Exhibit 24-2.Total cost at the profit-maximizing quantity of output is the

Quizplus · Accepted Answer

Total cost at the profit-maximizing quantity of output is the area 0P2CQ0. This is because total cost is equal to fixed cost plus variable cost, and at the profit-maximizing quantity of output, marginal cost is equal to marginal revenue. This means that the additional cost of producing one more unit of output is equal to the additional revenue that is generated by selling that unit of output. Therefore, total cost is minimized at the quantity of output where marginal cost equals marginal revenue.

Exhibit 24-2 -Refer to Exhibit 24-2.Total Cost at the Profit-Maximizing Quantity of the Profit-Maximizing