In the graph shown, if the market demand were to shift right, which of the following would occur for the firm?

Question

Quizplus · Accepted Answer

If the market demand were to shift right, the equilibrium price would increase, leading to an increase in the firm's revenue for each unit sold. This would cause the total revenue function to rotate upward, as the firm would generate more revenue at each output level. The total cost curve would remain the same, assuming that the cost of production does not change. The firm may potentially produce more output, depending on the extent of the shift in demand and the firm's production capacity. However, this is not necessarily a definitive outcome, as the firm's optimal output level also depends on factors such as cost of production and profit maximization.

In the Graph Shown, If the Market Demand Were to Shift