Question

QUESTION 4 When production is 2000, marginal revenue is $20 per unit and marginal cost is $22.25 per unit. Do you expect maximum profit to occur at a production level above or below 2000? Since marginal revenue is less than marginal cost around q = 2000, as you produce more of the product your revenue increases slower than your costs, so profit decreases, and maximal profit will occur at a production level below 2000. The profit function is not given, so there is not enough information to answer the question. Maximal profit will occur at the production level of 2000. Since marginal revenue is larger than marginal cost around q = 2000, as you produce more of the product your revenue increases faster than your costs, so profit increases, and maximal profit will occur at a production level above 2000. Since marginal revenue is less than marginal cost around q = 2000, as you produce more of the product your revenue increases faster than your costs, so profit increases, and maximal profit will occur at a production level above 2000.

Answer 1

QUESTION 4 When production is 2000, marginal revenue is $20 per unit and marginal cost is $22.25 per unit. Do you expect maximum profit to occur at a production level above or below 2000? Since marginal revenue is less than marginal cost around q = 2000, as you produce more of the product your revenue increases slower than your costs, so profit decreases, and maximal profit will occur at a production level below 2000. The profit function is not given, so there is not enough information to answer the question. Maximal profit will occur at the production level of 2000. Since marginal revenue is larger than marginal cost around q = 2000, as you produce more of the product your revenue increases faster than your costs, so profit increases, and maximal profit will occur at a production level above 2000. Since marginal revenue is less than marginal cost around q = 2000, as you produce more of the product your revenue increases faster than your costs, so profit increases, and Inaximal profit will occur at a production level above 2000. most probable explanation