-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 maximizing level of output?

Question

Quizplus · Accepted Answer

In a perfectly competitive market, a firm maximizes profit by producing where marginal cost (MC) equals the market price. If the market price is 4 cents, Fast Copy should produce at the output level where the MC curve intersects the price line at 4 cents, which is 48 pages per hour.

-Fast Copy Is a Perfectly Competitive Firm