-Figure 6.1 shows the cost structure of a firm in a perfectly competitive market. If the market price is $40, the firm's profit maximizing output level is

Question

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In a perfectly competitive market, a firm maximizes profit where marginal cost (MC) equals market price. If the market price is $40, the firm should produce at the output level where MC is $40, which is 900 units.

-Figure 61 Shows the Cost Structure of a Firm in a a Perfectly