Refer to the information provided in Figure 14.7 below to answer the questions that follow. Figure 14.7
-Refer to Figure 14.7. Six firms that produce chewing gum form a cartel. The cartel faces the market demand curve given by D. To maximize profits, the cartel should produce ________ packs of chewing gum and the price should be ________.

Question

Refer to the information provided in Figure 14.7 below to answer the questions that follow.  Figure 14.7
-Refer to Figure 14.7. Six firms that produce chewing gum form a cartel. The cartel faces the market demand curve given by D. To maximize profits, the cartel should produce ________ packs of chewing gum and the price should be ________.

Quizplus · Accepted Answer

To maximize profits, the cartel should produce where marginal cost equals marginal revenue. The price is determined by the demand curve at that quantity.

Refer to the Information Provided in Figure 14