Exhibit 22-8

-Refer to Exhibit 22-8. What is the total revenue of firm B at profit-maximizing (or loss-minimizing) level of output?

Question

Exhibit 22-8
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-Refer to Exhibit 22-8. What is the total revenue of firm B at profit-maximizing (or loss-minimizing) level of output?

Quizplus · Accepted Answer

The profit-maximizing (or loss-minimizing) level of output for a firm is where its marginal cost (MC) equals its marginal revenue (MR). In Exhibit 22-8, this occurs at a quantity of 70 units. The price per unit at this quantity, as indicated by the demand curve, is $15. Therefore, the total revenue (TR) is calculated as price per unit times quantity, which is $15 * 70 = $1,050.

Exhibit 22-8 ​

Exhibit 22-8