(Table: Competitive Firm) Refer to the table that shows therevenue and cost schedules for a competitive firm. What is themarginal cost at the profit maximizing quantity?
A)$50
B)$80
C)$230
D)$300

Question

(Table: Competitive Firm) Refer to the table that shows therevenue and cost schedules for a competitive firm. What is themarginal cost at the profit maximizing quantity?
A)$50 
B)$80 
C)$230 
D)$300

Quizplus · Accepted Answer

The profit maximizing quantity is where marginal revenue equals marginal cost. At output level 4, the marginal cost is $80, which is equal to the marginal revenue of $80. This is the profit maximizing quantity as producing any more units would result in the marginal cost being higher than the marginal revenue, leading to a decrease in profit.

(Table: Competitive Firm) Refer to the Table That Shows Therevenue