Figure 5.1 Cost and Demand Conditions of a Perfectly Competitive Firm

-Refer to Figure 5.1. At the profit-maximizing output, the firm's total revenue equals
A) $2,400
B) $3,000
C) $3,600
D) $4,200

Question

Figure 5.1 Cost and Demand Conditions of a Perfectly Competitive Firm
 
-Refer to Figure 5.1. At the profit-maximizing output, the firm's total revenue equals
A) $2,400 
B) $3,000 
C) $3,600 
D) $4,200

Quizplus · Accepted Answer

At the profit-maximizing output, a firm's total revenue is determined by the quantity of goods sold multiplied by the price per unit. Without the specific details from Figure 5.1, such as the price per unit and the quantity sold at the profit-maximizing level, it's not possible to directly calculate or confirm the total revenue. However, based on standard economic theory, the profit-maximizing output is where marginal cost equals marginal revenue. The correct answer would typically be found by identifying this point on a graph and calculating the total revenue (price times quantity) at this output level. Since I cannot see Figure 5.1, I cannot provide the specific calculation or rationale from the figure itself, but the correct answer is selected based on the premise of the question.

Figure 51 Cost and Demand Conditions of a Perfectly Competitive Firm