Answer to Question #157257 in Microeconomics for Iqra

Question

A perfectly  competitive firm has the following  total cost function.

Total Output     Total Cost

     0              20

     1              30

     2              42

     3              55

     4              69

     5              84

     6              100

     7              117

How much will the firm produce  if the price  of the production  the market  is Rs. 14 per unit? How will it change  its output  if price  if rises  to Rs. 16 per uni5?

Answer 1

Total output TC MC

0 20 -

1 30 10

2 42 12

3 55 13

4 69 14

5 84 15

6 100 16

7 117 17

If p=14, Q=4

If p=16, Q=6