The following graph shows the marginal revenue (MR)and marginal cost (MC)curves of an imperfectly competitive firm. Figure 8.2 Refer to Figure 8.2.If the current production level is 90 and the firm wishes to maximize profit, it should:
A)leave the current production level unchanged.
B)decrease the quantity produced to 75.
C)decrease the quantity produced to 50.
D)decrease the quantity produced to 35.
E)increase production until MR = MC.

Question

The following graph shows the marginal revenue (MR)and marginal cost (MC)curves of an imperfectly competitive firm. Figure 8.2  Refer to Figure 8.2.If the current production level is 90 and the firm wishes to maximize profit, it should:
A)leave the current production level unchanged. 
B)decrease the quantity produced to 75. 
C)decrease the quantity produced to 50. 
D)decrease the quantity produced to 35. 
E)increase production until MR = MC.

Quizplus · Accepted Answer

The Answer of The following graph shows the marginal revenue (MR)and marginal cost (MC)curves of an imperfectly competitive firm. Figure 8.2  Refer to Figure 8.2.If the current production level is 90 and the firm wishes to maximize profit, it should:
A)leave the current production level unchanged. 
B)decrease the quantity produced to 75. 
C)decrease the quantity produced to 50. 
D)decrease the quantity produced to 35. 
E)increase production until MR = MC.

The Following Graph Shows the Marginal Revenue (MR)and Marginal Cost