Question
Marginal revenue for a firm equals its marginal cost at an output of Q=3. At this quantity, the price faced by the firm is p
Marginal revenue for a firm equals its marginal cost at an output of Q=3. At this quantity, the price faced by the firm is p = $10. The firm's Total Cost is $36 and its Total Variable Cost is $30. What MUST be true about the firm's production level?
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aThe firm should shut-down.
bThe firm should produce Q=3 units of output and bear losses.
cThe firm should produce Q=3 units of output where it makes profits.
dThere is not enough information to determine where the firm should produce.
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