Use the following to answer questions:
-(Table: Total Cost for a Perfectly Competitive Firm) Look at the table Total Cost for a Perfectly Competitive Firm. If the market price is $4.50, profit at the profit-maximizing quantity of output is:

Question

Use the following to answer questions: 
-(Table: Total Cost for a Perfectly Competitive Firm) Look at the table Total Cost for a Perfectly Competitive Firm. If the market price is $4.50, profit at the profit-maximizing quantity of output is:

Quizplus · Accepted Answer

Profit is maximized when marginal cost equals price. At a price of $4.50, marginal cost is $2.50. Total cost at the profit-maximizing quantity of output is $31.50. Profit is equal to total revenue minus total cost, which is (4.50 * 15) - 31.50 = $2.00.

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