According to the Rational Rule for Sellers, this company should produce ____ of output and charge a price of _____.
$$\begin{array} { | l | l | l | l | l | l | }
\hline \text { Quantity } & \text { Price } & \begin{array} { l }
\text { Total } \
\text { revenue }
\end{array} & \begin{array} { l }
\text { Total } \
\text { cost }
\end{array} & \begin{array} { l }
\text { Marginal } \
\text { revenue }
\end{array} & \begin{array} { l }
\text { Marginal } \
\text { cost }
\end{array} \
\hline 1 & \$ 300 & \$ 300 & \$ 100 & \$ 300 & \$ 100 \
\hline 2 & \$ 250 & \$ 500 & \$ 200 & \$ 200 & \$ 100 \
\hline 3 & \$ 200 & \$ 600 & \$ 300 & \$ 100 & \$ 100 \
\hline 4 & \$ 150 & \$ 600 & \$ 400 & \$ 0 & \$ 100 \
\hline
\end{array}$$
A)one unit; $300
B)two units; $200
C)three units; $200
D)four units; $150

Question

According to the Rational Rule for Sellers, this company should produce ____ of output and charge a price of _____.
$$\begin{array} { | l | l | l | l | l | l | } 
\hline \text { Quantity } & \text { Price } & \begin{array} { l } 
\text { Total } \
\text { revenue }
\end{array} & \begin{array} { l } 
\text { Total } \
\text { cost }
\end{array} & \begin{array} { l } 
\text { Marginal } \
\text { revenue }
\end{array} & \begin{array} { l } 
\text { Marginal } \
\text { cost }
\end{array} \
\hline 1 & \$ 300 & \$ 300 & \$ 100 & \$ 300 & \$ 100 \
\hline 2 & \$ 250 & \$ 500 & \$ 200 & \$ 200 & \$ 100 \
\hline 3 & \$ 200 & \$ 600 & \$ 300 & \$ 100 & \$ 100 \
\hline 4 & \$ 150 & \$ 600 & \$ 400 & \$ 0 & \$ 100 \
\hline
\end{array}$$
A)one unit; $300
B)two units; $200
C)three units; $200
D)four units; $150

Quizplus · Accepted Answer

The Rational Rule for Sellers suggests producing up to the point where marginal revenue equals marginal cost. In the table, this condition is met at the production of three units, where both marginal revenue and marginal cost are $100.

According to the Rational Rule for Sellers, This Company Should