Refer to the information provided in Figure 13.10 below to answer the question(s) that follow. Figure 13.10
-Refer to Figure 13.10. If Armstrong Cable is forced to sell the efficient level output, it will
A) incur a loss of $7,250.
B) incur a loss of $1,250.
C) earn a zero profit.
D) earn a profit of $4,000.

Question

Refer to the information provided in Figure 13.10 below to answer the question(s) that follow.  Figure 13.10
-Refer to Figure 13.10. If Armstrong Cable is forced to sell the efficient level output, it will
A) incur a loss of $7,250. 
B) incur a loss of $1,250. 
C) earn a zero profit. 
D) earn a profit of $4,000.

Quizplus · Accepted Answer

At the efficient level of output, total revenue minus total cost results in a loss of $1,250. This is determined by finding the point where marginal cost equals marginal revenue (the efficient level of output) and then comparing the total cost to the total revenue at that quantity.

Refer to the Information Provided in Figure 13