Question
Assume that the market determined price is $10 in a perfectly competitive industry.A firm is currently producing 100 units of output.Average total cost is $8
Assume that the market determined price is $10 in a perfectly competitive industry.A firm is currently producing 100 units of output.Average total cost is $8 while marginal cost is $8 and average variable cost is $6. Profit is maximized when maginal cost is equal to price. Price in this case is above marginal cost. What is the price and what is the marginal cost?
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Accounting Principles A Business Perspective Financial Accounting Chapter 1-8
Authors: James Edwards, Roger Hermanson, Bill Buxton
1st Edition
1461088186, 978-1461088189
