Table 17-11
Only two firms, ABC and XYZ, sell a particular product. The table below shows the demand curve for their product. Each firm has the same constant marginal cost of $8 and zero fixed cost.
-Refer to Table 17-11. If ABC and XYZ operate to jointly maximize profits, then what quantity is sold?
A)25
B)30
C)35
D)40

Question

Table 17-11
Only two firms, ABC and XYZ, sell a particular product. The table below shows the demand curve for their product. Each firm has the same constant marginal cost of $8 and zero fixed cost. 
-Refer to Table 17-11. If ABC and XYZ operate to jointly maximize profits, then what quantity is sold?
A)25 
B)30 
C)35 
D)40

Quizplus · Accepted Answer

The profit-maximizing quantity is where marginal revenue equals marginal cost. From Table 17-11, we can see that marginal revenue is equal to marginal cost at a quantity of 25.

Table 17-11 Only Two Firms, ABC and XYZ, Sell a Particular Product