Refer to the data provided in Table 9.2 below to answer the questions that follow.
Table 9.2 $$\begin{array} { l l l l l l l }
\text { q } & \text { TFC } & \text { TVC } & \text { TC } & \text { MC } & \text { AVC } & \text { ATC } \
\hline 0 & \$ 50 & \$ 0 & \$ 50 & - - & - - & - - \
1 & 50 & 20 & 70 & 20 & 20 & 70 \
2 & 50 & 30 & 80 & 10 & 15 & 40 \
3 & 50 & 45 & 95 & 15 & 15 & 31.67 \
4 & 50 & 62 & 112 & 17 & 15.50 & 28 \
5 & 50 & 90 & 140 & 28 & 18 & 28 \
6 & 50 & 132 & 182 & 42 & 22 & 30.33 \
7 & 50 & 186 & 236 & 54 & 26.57 & 33.71 \
\hline
\end{array}$$
-Refer to Table 9.2. If the market price is $20, then to maximize profits this firm should produce
A) zero units of output.
B) one unit of output.
C) two units of output.
D) an output level of about four.

Question

Refer to the data provided in Table 9.2 below to answer the questions that follow.
Table 9.2 $$\begin{array} { l l l l l l l } 
\text { q } & \text { TFC } & \text { TVC } & \text { TC } & \text { MC } & \text { AVC } & \text { ATC } \
\hline 0 & \$ 50 & \$ 0 & \$ 50 & - - & - - & - - \
1 & 50 & 20 & 70 & 20 & 20 & 70 \
2 & 50 & 30 & 80 & 10 & 15 & 40 \
3 & 50 & 45 & 95 & 15 & 15 & 31.67 \
4 & 50 & 62 & 112 & 17 & 15.50 & 28 \
5 & 50 & 90 & 140 & 28 & 18 & 28 \
6 & 50 & 132 & 182 & 42 & 22 & 30.33 \
7 & 50 & 186 & 236 & 54 & 26.57 & 33.71 \
\hline
\end{array}$$
-Refer to Table 9.2. If the market price is $20, then to maximize profits this firm should produce
A) zero units of output.
B) one unit of output.
C) two units of output.
D) an output level of about four.

Quizplus · Accepted Answer

The firm should produce an output level of about four to maximize profits. At this output level, the firm's marginal cost is equal to the market price, which means that the firm is producing at the point where its profit is maximized.

Refer to the Data Provided in Table 9 -Refer to Table 9