-Refer to Figure 9-4. The firm represented in the diagram is currently sellingQ_a units at a price of $P_a. Is this firm maximizing its profit and if it is not, what would you recommend to the firm? A) No, it is not; it should lower its price to $P_band sell Q_bunits. B) Yes, it is maximizing its profit by charging the highest price possible. C) No, it is not; it should lower its price to $P_cand sell Q_cunits. D) No, it is not; since its marginal cost is constant, it should produce and sell as much as it can. It should sell Q_dunits at a price of $P_d.

Question

Quizplus · Accepted Answer

Without access to Figure 9-4, the correct answer cannot be determined based on the provided information. However, the recommendation to adjust price and quantity suggests a strategy to align closer with marginal cost and marginal revenue principles for profit maximization, which is a common economic recommendation.