(Table: Competitive Firm) Refer to the table. The profitmaximizing output for this firm is:
A)5.
B)6.
C)7.
D)8.

Question

(Table: Competitive Firm) Refer to the table. The profitmaximizing output for this firm is:
A)5. 
B)6. 
C)7. 
D)8.

Quizplus · Accepted Answer

To find the profit maximizing output, we need to find the output level that corresponds to maximum profit. We can do this by comparing the marginal revenue and marginal cost. At an output of 7 units, the marginal revenue is $15 and the marginal cost is $15. Therefore, the profit maximizing output level for this firm is 7 units, which will result in a profit of $20.

(Table: Competitive Firm) Refer to the Table