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3 November, 07:27

A competitive firm has been selling its output for $20 per unit and has been maximizing its profit, which is positive. Then, the price rises to S25, and the firm makes whatever adjustments are necessary to maximize its profit at the now-higher price. Once the firm has adjusted, its a. quantity of output is higher than it was previously. b. average total cost is higher than it was previously. c. marginal revenue is higher than it was previously. d. All of the above are correct. 5. 6. A profit-maximizing firm in a competitive market is currently producing 200 units of output. It has average revenue of $9 and average total cost of S7. It follows that the firm'se a. average total cost curve intersects the narginal cost curve at an output level of less than 200 units. b. average variable cost curve intersects tne maiguial cost curve at an output level of less 双击可隐藏空白: than 200 units. e c. profit is $400. d. All of the above are correct.

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  1. 3 November, 09:22
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    Answer: c. marginal revenue is higher than it was previously.

    Explanation:

    Marginal revenue is higher than it was previously.

    Marginal Revenue is the additional revenue that is generated by selling one more unit, In a Competitive market Firms are price takers meaning the can only adjust quantity and not the price.

    The marginal Revenue equals to the price of a good or service. When Price increases from $20 to $25, the Marginal Revenue will be $25 which is higher than it was previously
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