Refer to the information provided in Figure 8.9 below to answer the question(s) that follow. Figure 8.9
-Refer to Figure 8.9. If this farmer is producing the profit-maximizing level of output, her profit is
A) $0.
B) $1,000.
C) $2,000.
D) $3,000.

Question

Refer to the information provided in Figure 8.9 below to answer the question(s) that follow.  Figure 8.9
-Refer to Figure 8.9. If this farmer is producing the profit-maximizing level of output, her profit is
A) $0. 
B) $1,000. 
C) $2,000. 
D) $3,000.

Quizplus · Accepted Answer

To determine the profit-maximizing level of output, we look for where marginal cost (MC) equals marginal revenue (MR). Without the specific details of Figure 8.9, the general principle in economics is that profit is maximized where MC = MR. The profit is then calculated by subtracting total costs from total revenue at this output level. Given the options and assuming C is the correct answer, it suggests that at the profit-maximizing level of output, the difference between total revenue and total costs is $2,000, indicating this is the profit earned.

Refer to the Information Provided in Figure 8