Refer to the figure below. If this firm is a price taker, then when the price of each unit if output is $15, what is this firm's profit-maximizing level of output?

Question

Quizplus · Accepted Answer

For a price taker firm, the profit-maximizing level of output occurs where marginal cost equals price. Looking at the graph, at a price of $15, the marginal cost curve intersects the marginal revenue curve (which is also the demand curve) at around 60 units of output. Therefore, the profit-maximizing level of output for this firm is 60 units.

Refer to the Figure Below