Exhibit 7-3 Cost per unit curves

-In Exhibit 7-3,if the price of the firm's product is $2.00 per unit,the firm will produce:

Question

Exhibit 7-3 Cost per unit curves
 
-In Exhibit 7-3,if the price of the firm's product is $2.00 per unit,the firm will produce:

Quizplus · Accepted Answer

At $2.00 per unit, the firm will produce the quantity where the marginal cost intersects the price, which is 15 units per day. This is the profit-maximizing output level as at this quantity, marginal revenue equals marginal cost. Going beyond this point would result in higher costs than revenue, resulting in a loss. Therefore, producing 15 units per day is the best choice for the firm.

Exhibit 7-3 Cost Per Unit Curves