Could someone help me answer this question? thank you! The graph on the right pr
ID: 1164696 • Letter: C
Question
Could someone help me answer this question? thank you!
The graph on the right presents the costs and revenue for a purely competitive firm, where the market price is equal to $600 per unit of output. This firm has a fixed cost equal to $3,600. Use this information to determine the profit-maximizing output and profit for this firm. 2400 1. What is the profit-maximizing output of this purely competitive firm? (Round your 200 answer to the nearest whole number.) Marginal Cost 2000 1800 1600 1400 1200 Average Tatal Cost Number Units of Output Average Variable Cost 2. What is the economic profit (loss) for this 1000 purely c answer to the nearest positive or negative 800 integer.) itive firm? (Round your 600 400 200 Marginal Revenue Number 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Units of Output Previous Check Answer NexExit HintExplanation / Answer
Ans1) In competitive firm, at profit maximisation P = MC. So the profit maximising output of this purely competitive firm is 6 units of output.
Ans2) Profit = total revenue - total cost
= P*Q - ATC * Q
= 600*6 - 1000* 6 = -2400 so economic loss.