Exhibit 8-11 A firm's cost and marginal revenue curves B 7 CO 6 Cost, revenues 5 (dollars) 4 3 2 1 0 78 10 In Exhibit 8-11, when the price is $5, the firm: O a. should produce output equal to 10. Ob. is breaking even. Oc. should produce output equal to 7. Od. is making an economic profit of $21. MC P=MR=8 ATC P=MR=5 AVC P=MR=2

Exhibit 8-11 A firm's cost and marginal revenue curves B 7 CO 6 Cost, revenues 5 (dollars) 4 3 2 1 0 78 10 In Exhibit 8-11, when the price is $5, the firm: O a. should produce output equal to 10. Ob. is breaking even. Oc. should produce output equal to 7. Od. is making an economic profit of $21. MC P=MR=8 ATC P=MR=5 AVC P=MR=2

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter13: Firms In Competitive Markets

Section: Chapter Questions

Problem 6PA: A firm in a competitive market receives 500 in total revenue and has marginal revenue of 10. What is...

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