The following figure depicts the short-run cost curves of a perfectly competitive firm.

-Refer to the figure above.If the current market price is $9,the profit-maximizing output of this firm is ________.
A) 15
B) 55
C) 70
D) 85

Question

The following figure depicts the short-run cost curves of a perfectly competitive firm.
 
-Refer to the figure above.If the current market price is $9,the profit-maximizing output of this firm is ________.
A) 15 
B) 55 
C) 70 
D) 85

Quizplus · Accepted Answer

The profit-maximizing output is where marginal cost equals marginal revenue. In this case, marginal cost is $5 and marginal revenue is $10. So the profit-maximizing output is 55 units.

The Following Figure Depicts the Short-Run Cost Curves of a Perfectly