11. Profit maximization using total cost and total revenue curves Suppose Madison operates a handicraft popup retail shop that sells cardigans. Assume a perfectly:r competitive market structure for cardigans with a market price equal to $20 per cardigan. The following graph shows Madison's total cost curve. Use the blue points (circle symbol) to plot tetai' revenue zinc.r the green points (triangle symbol) to pint prot for cardigans for quantities zero through seven (including zero and seven) that Madison produces. \fMadison's prot is maximized when they produce a total of \\:| cardigans. At this quantity, the marginal cost of the final cardigan they produce is , an amount V than the price received for each cardigan they sell. At this pointr the marginal cost of producing one more cardigan (the rst cardigan beyond the profit maximizing quantity) is- an amount V than the price received for each cardigan they sell. Therefore, Madison's profit-maximizing quantity occurs at the point of intersection between the V curves. Because Madison is a price taker, the previous condition is equivalent to