A perfectly competitive firm produces 3,000 units of a good at a total cost of $36,000.The price of each good is $10.Calculate the firm's short-run profit or loss.

Question

Quizplus · Accepted Answer

The total revenue for the firm is:
Price x Quantity = $10 x 3,000 = $30,000
The total cost for the firm is $36,000
Therefore, the short-run profit or loss for the firm is:
Total Revenue - Total Cost = $30,000 - $36,000 = -$6,000
As the result is negative, the firm is making a loss of $6,000.

A Perfectly Competitive Firm Produces 3,000 Units of a Good