Blog

Assume that marginal revenue equals rising marginal cost at 100 units of output. At this output level, a profit-maximizing firm’s total fixed cost is $600 and its total variable cost is $400. If the price of the product is $8 per unit, then the firm should produce less than 100 units of output.

Table 5.3Table 5.3Total OutputTotal Cost  0  2  4  6  810$100$196$212$310$430$570In Table 5.3, the average fixed cost of the first unit of output is

If a firm is producing where marginal revenue is less than marginal cost, the firm should increase its level of output to increase profits.

A firm wishing to maximize profits will produce at the level of output where

In the short run, all resources are fixed.

The marginal cost and average cost curves always intersect at the minimum average cost.

Which of the following sayings illustrates diminishing returns in the short run?

Which of the following does not refer to diminishing marginal returns?

Assume that marginal revenue equals rising marginal cost at 100 units of output. At this output level, a profit-maximizing firm’s total fixed cost is $600 and its total variable cost is $400. If the price of the product is $8 per unit, the firm should produce

The long run is a period of time just long enough so that at least one of the resources cannot be changed.