Scenario 14-4
The information below applies to a competitive firm that sells its output for $40 per unit.
• When the firm produces and sells 150 units of output, its average total cost is $24.50.
• When the firm produces and sells 151 units of output, its average total cost is $24.55.
-Refer to Scenario 14-4. When the firm increases its output from 150 units to 151 units, its profit
A)decreases by $5.75.
B)decreases by $7.20.
C)increases by $4.15.
D)increases by $7.95.

Question

Quizplus · Accepted Answer

The Answer of Scenario 14-4
The information below applies to a competitive firm that sells its output for $40 per unit.
• When the firm produces and sells 150 units of output, its average total cost is $24.50.
• When the firm produces and sells 151 units of output, its average total cost is $24.55.
-Refer to Scenario 14-4. When the firm increases its output from 150 units to 151 units, its profit
A)decreases by $5.75.
B)decreases by $7.20.
C)increases by $4.15.
D)increases by $7.95.

Scenario 14-4 The Information Below Applies to a Competitive Firm That Sells