If a firm has determined its optimal output level, where MR = MC, then price
A)is unchanged.
B)is set by statistical analysis of the market.
C)is equal to MC.
D)is determined by the market demand at that output.

Question

Quizplus · Accepted Answer

At the optimal output level where marginal revenue (MR) equals marginal cost (MC), the price at which the firm sells its product is determined by the market demand for that product at that specific output level. This is because the firm's decision on how much to produce influences the price point at which the produced quantity can be sold in the market.

If a Firm Has Determined Its Optimal Output Level, Where