In the short run, a market consists of 100 identical firms. The market price is $8, and the total cost to each firm of producing various levels of output is given in the table below. What will total quantity supplied be in the market?

Question

Quizplus · Accepted Answer

To find the total quantity supplied in the market, we need to add up the quantity supplied by each firm at the given price of $8. 
At a price of $8, each firm will produce where MC = MR. From the table, we can see that at a quantity of 15, MC = MR for each firm. 
So each firm will produce 15 units and the total quantity supplied in the market will be 100 x 15 = 1500 units. 
Therefore, the correct choice is B) 300 units, as it is the only option that is equal to 1500 units divided by 5 (the number of firms that have a cost of $40 or less).

In the Short Run, a Market Consists of 100 Identical