-Refer to Figure 9.3.What is the smallest sales quantity that this firm will produce?
A) 0
B) Q1
C) Q2
D) Q3

Question

-Refer to Figure 9.3.What is the smallest sales quantity that this firm will produce?
A) 0 
B) Q1 
C) Q2 
D) Q3

Quizplus · Accepted Answer

The smallest sales quantity a firm will produce is at the point where price equals marginal cost, which is typically represented as Q1 in economic graphs. This is the point where the firm starts to cover its variable costs and producing any less would mean not taking advantage of covering some of the fixed costs.