The following figure shows the marginal cost curve (MC) for a firm producing fancy dolls for children.The market price for a doll is $4 per unit.
-Refer to Figure .Identify the correct statement from the following.Assume that the firm is trying to maximize profit and faces a $4 market price for dolls.
A) The firm will produce 2,000 dolls per month.
B) The firm's profit declines as the firm expands production beyond 2,000 dolls per month.
C) The firm's profit rises as the firm expands production beyond 20,000 dolls per month.
D) The firm will produce 20,000 dolls per month.
Correct Answer:
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