a firm in a perfect competitive market structure faces a marginal cost

1.	a firm in a perfect competitive market structure faces a marginal cost function given by MC(Q)=4Q+5 where Q represents quantity of output produced. This firm earns marginal revenue of rs 25 on each unit scale of its output.suppose this firm decides to produce 3 units of output,is this a profit maximising decision by the firm? if not,how much should this firm produce to earn maximum profits? In the long-run will this firm earn negative economic profits, positive economic profits or zero economic profits?
Answer» <P>Answer:Hope it helps Explanation:To find the equilibrium set MARKET demand equal to market supply: 1000 – 2Q = 100 + Q. Solving for Q, you get Q = 300. Plugging 300 BACK into either the market demand curve or the market supply curve you get P = 400.

a firm in a perfect competitive market structure faces a marginal cost function given by MC(Q)=4Q+5 where Q represents quantity of output produced. This firm earns marginal revenue of rs 25 on each unit scale of its output.suppose this firm decides to produce 3 units of output,is this a profit maximising decision by the firm? if not,how much should this firm produce to earn maximum profits? In the long-run will this firm earn negative economic profits, positive economic profits or zero economic profits?

Answer»

<P>Answer:Hope it helps

Explanation:To find the equilibrium set MARKET demand equal to market supply: 1000 – 2Q = 100 + Q. Solving for Q, you get Q = 300. Plugging 300 BACK into either the market demand curve or the market supply curve you get P = 400.

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