Refer to the above diagram for athletic shoes.The optimal output of shoes: A)is Q₁. B)is Q₂. C)is Q₃. D)is greater than Q₃.

Question

Quizplus · Accepted Answer

The optimal output of shoes can be found where Marginal Cost (MC) is equal to Marginal Revenue (MR). At this point, the firm will maximize profits. In the diagram above, MC intersects MR at a quantity of 12 (Q₂). Therefore, the best choice is B.

Refer to the Above Diagram for Athletic Shoes