Table 14-3
The table represents a demand curve faced by a firm in a competitive market.
-Refer to Table 14-3. For this firm, the price is

Question

Table 14-3
The table represents a demand curve faced by a firm in a competitive market. 
-Refer to Table 14-3. For this firm, the price is

Quizplus · Accepted Answer

The firm is facing a competitive market, which means it has no market power to influence the price. Therefore, the firm must accept the market price given by the demand and supply forces. In this case, the intersection of the demand curve and the supply curve occurs at a price of $13, which is the market-clearing price. So, the firm must sell its output at this price if it wants to maximize its profit. Selling at a higher price would result in no sales, as consumers would switch to other firms, and selling at a lower price would result in lower profit per unit sold.

Table 14-3 The Table Represents a Demand Curve Faced by a Firm