5. Consider the marginal revenue and marginal cost curves shown in Figure 7.13. Assume that the firm represented is able to cover its variable costs if it operates in the short run. What is the firm's optimal output level?a.150 unitsb.80 unitsc.50 unitsd.less than 50 unitse.between 50 and 80 unitsChoose and explain your answer above thoroughly--graphical, algebraically, numerically. Please use as much detail as possible in the explanation. Figure 7 - 13Dollarsper UnitMCMRUnits ofOutput50801505. Consider the marginal revenue and marginal cost curves shown in Figure 7.13. Assume that the firm represented is able to cover its variable costs if it operates in the shortrun. What is the firm's optimal output level?a.150 unitsb. 80 unitsС.50 unitsd. less than 50 unitsе.between 50 and 80 unitsChoose and explain your answer above thoroughly--graphical, algebraically, numerically.EXPLAIN IN DETAIL. THE MORE ECONOMIC CONCEPTS YOU USE IN YOUR EXPLANATION THE HIGHER YOUR SCORE.

The above mentioned figure is of monopoly, i.e., the market structure that has a single seller and a…

Answered: 5. Consider the marginal revenue and…

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 4PA

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5. Consider the marginal revenue and marginal cost curves shown in Figure 7.13. Assume that the firm represented is able to cover its variable costs if it operates in the short run. What is the firm's optimal output level?

a.	150 units
b.	80 units
c.	50 units
d.	less than 50 units
e.	between 50 and 80 units

Choose and explain your answer above thoroughly--graphical, algebraically, numerically.

Please use as much detail as possible in the explanation.

Figure 7 - 13
Dollars
per Unit
MC
MR
Units of
Output
50
80
150
5. Consider the marginal revenue and marginal cost curves shown in Figure 7.13. Assume that the firm represented is able to cover its variable costs if it operates in the short
run. What is the firm's optimal output level?
a.
150 units
b. 80 units
С.
50 units
d. less than 50 units
е.
between 50 and 80 units
Choose and explain your answer above thoroughly--graphical, algebraically, numerically.
EXPLAIN IN DETAIL. THE MORE ECONOMIC CONCEPTS YOU USE IN YOUR EXPLANATION THE HIGHER YOUR SCORE.

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