-The firm in Figure 10-7 does not practice price discrimination.Its price and output will be
A)$300 and 175
B)$50 and 125
C)$250 and 125
D)$180 and 160
E)none of these since the firm should immediately shut down in the short run

Question

-The firm in Figure 10-7 does not practice price discrimination.Its price and output will be
A)$300 and 175 
B)$50 and 125 
C)$250 and 125 
D)$180 and 160 
E)none of these since the firm should immediately shut down in the short run

Quizplus · Accepted Answer

The firm will set its price and output where marginal cost equals marginal revenue, which is typically at a lower price and higher output than the maximum price point.

-The Firm in Figure 10-7 Does Not Practice Price Discrimination