50 Price and cost (cents per unit) 30 20 LRAC MR MC D o 10 20...

Question

Question

Answer 1

Answer #1

The correct answer is $200

Because Dead weight loss = 1/2×(25-5)×(40-20)

= 1/2 × 20 × 20 = $200

At Marginal cost pricing when MR = MC, the price = $25 and output = 20

At perfect competition Market when P = MC

the price = $5 and output = 40

Answer 2

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