-The firm operating with the information given in this table would maximize profit by producing:
A) 2 units of output.
B) 3 units of output.
C) 4 units of output.
D) 5 units of output.

Question

-The firm operating with the information given in this table would maximize profit by producing:
A) 2 units of output. 
B) 3 units of output. 
C) 4 units of output. 
D) 5 units of output.

Quizplus · Accepted Answer

The firm maximizes profit by producing at the level where marginal cost (MC) is equal to marginal revenue (MR), assuming MR is constant and equal to the price. Without specific numbers, the general principle is to produce up to the point where the cost of producing an additional unit (MC) equals the revenue gained from selling that additional unit (MR). Since the exact figures are not provided, the correct answer hinges on understanding this economic principle.

-The Firm Operating with the Information Given in This Table