Figure 10.4 shows the demand, marginal revenue, and cost curves for a monopolistic competitor. At the profit-maximizing output level, the total cost incurred by the firm in is approximately _____.
Figure 10.4

Question

Figure 10.4 shows the demand, marginal revenue, and cost curves for a monopolistic competitor. At the profit-maximizing output level, the total cost incurred by the firm in is approximately _____.​ ​
Figure 10.4
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Quizplus · Accepted Answer

At the profit-maximizing output level, the firm will produce where MR=MC. This occurs at a quantity of 70 units. At this quantity, the marginal cost is approximately $70 and the marginal revenue is approximately $70 as well. The total cost at this quantity is approximately $4,940, which is where the MC curve intersects the ATC curve. Therefore, the answer is D) $4,940.

Figure 104 Shows the Demand, Marginal Revenue, and Cost Curves for for a Monopolistic