Consider an industry with two firms producing similar products.
Mega Corp's total costs are TC = $5,000 + 100 × Quantity.
Big Inc's total costs are TC = $4,000 + 200 × Quantity.
Refer to the information given above.When each firm produces 8 units _____ has lower costs,and when each firm produces 12 units _____ has lower costs.

Question

Quizplus · Accepted Answer

At 8 units,Mega Corp has costs of $5,800 and Big Inc has costs of $5,600.At 12 units Mega Corp has costs of $6,200 and Big Inc has costs of $6,400.

Consider an Industry with Two Firms Producing Similar Products