Suppose the total cost to produce quantity q is TC(q)= 250 + q²/10. If this firm is a price- taker and the market price is p = 10, then the firm's total cost will be: A)equal to the marginal revenue. B)zero. C)equal to the total revenue. D)equal to the price.

Question

Quizplus · Accepted Answer

The firm's total cost, given by TC(q) = 250 + q²/10, simplifies to TC(q) = 250 since the term involving q becomes 0. If the market price is p = 10, then the total revenue (TR) for selling q units is TR = p*q = 10*q. For the firm to cover its total cost with its total revenue, the amount of q produced and sold must be such that TR = TC. Therefore, the total cost is equal to the total revenue, not directly to the price or marginal revenue, and it certainly is not zero.

Suppose the Total Cost to Produce Quantity Q Is TC(q)=