Table 9-2

-Refer to Table 9-2.This table provides information on a competitive price-taker firm's output,marginal revenue,and marginal cost.If the firm is currently producing 14 units,what would you advise them to do?
A)Decrease quantity to 13 units.
B)Increase quantity to 17 units.
C)Continue to operate at 14 units.
D)Increase quantity to 16 units.

Question

Table 9-2
 
-Refer to Table 9-2.This table provides information on a competitive price-taker firm's output,marginal revenue,and marginal cost.If the firm is currently producing 14 units,what would you advise them to do?
A)Decrease quantity to 13 units. 
B)Increase quantity to 17 units. 
C)Continue to operate at 14 units. 
D)Increase quantity to 16 units.

Quizplus · Accepted Answer

In a competitive market, a firm maximizes profit where marginal cost (MC) equals marginal revenue (MR). If the firm is producing 14 units and the marginal cost is less than the marginal revenue, it should increase production. Increasing to 16 units is likely where MC equals MR.

Table 9-2 -Refer to Table 9-2.This Table Provides Information on a Competitive