In a perfectly competitive market, each firm has the cost function: q 2+10q+100. The price in the market is $50. a. What is the Marginal Cost for the firm? b. What is the Profit Maximizing Output? c. What is the Total Profit the firm receives?

In a perfectly competitive market, each firm has the cost function: q 2+10q+100. The price in the market is $50. a. What is the Marginal Cost for the firm? b. What is the Profit Maximizing Output? c. What is the Total Profit the firm receives?

Microeconomics

13th Edition

ISBN:9781337617406

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter9: Perfect Competition

Section9.3: Perfect Competition In The Long Run

Problem 3ST

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Question

In a perfectly competitive market, each firm has the cost function: q 2+10q+100. The price in the market is $50.

a. What is the Marginal Cost for the firm?

b. What is the Profit Maximizing Output?

c. What is the Total Profit the firm receives?

d. Should this firm continue to produce in the short run? Please explain.

e. If the price is $20, should the firm continue to produce? Please explain.

Definition Definition Structure of the market that exists when many buyers and sellers exchange similar commodities and prices are fixed by market forces, demand, and supply. When there is perfect competition, a single business cannot impact the price or market value of the homogenous product.

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