-Fast Copy is a perfectly competitive firm. The figure above shows Fast Copy's cost curves. If the market price is 4 cents per page, what is Fast Copy's profit- maximising level of output?

Question

Quizplus · Accepted Answer

In a perfectly competitive market, a firm maximizes profit by producing at the level where marginal cost (MC) equals the market price. If the market price is 4 cents per page, the profit-maximizing level of output is where the MC curve intersects the price line at 4 cents, which corresponds to 48 pages per hour.

-Fast Copy Is a Perfectly Competitive Firm