Scenario 14-1
Assume a certain firm is producing 1000 units of output (so Q = 1000).At Q = 1000, the firm's marginal cost equals $15 and its average total cost equals $11.The firm sells its output for $12 per unit.
-Refer to Scenario 14-1.At Q = 1000,what is the firm's profit

Question

Quizplus · Accepted Answer

To calculate the firm's profit at Q = 1000, we need to first calculate its total revenue and total cost. Total revenue is calculated by multiplying price per unit by the quantity sold:
Total Revenue = Price x Quantity = $12 x 1000 = $12,000

Total cost is calculated by adding up all the costs incurred in producing 1000 units:
Total Cost = Average Total Cost x Quantity = $11 x 1000 = $11,000

Now we can calculate the firm's profit as the difference between total revenue and total cost:
Profit = Total Revenue - Total Cost = $12,000 - $11,000 = $1000

Therefore, the best choice is B) $1000, as this is the firm's profit at Q = 1000.

Scenario 14-1 Assume a Certain Firm Is Producing 1000 Units of Output