The figure shows the marginal cost, average total cost, average variable cost, a

Question

The figure shows the marginal cost, average total cost, average variable cost, average revenue, and marginal revenue curves for a perfectly competitive firm. The firm is currently producing 80 units of output. To maximize profits (or minimize losses) the firm should: A) increase output to 140 units B)raise its price and hold output constant C) not change it’s output level because profits are maximized or losses are minimized at 80 units. D) raise its price and raise output E) increase output to 180 units
ssessments-2017FA-2 × Take Test Final exam Fa·x e G The figure above dows × C University of Houston-Victoria US11 https//elearning.uh.edu/webapps/as Figure 7-3 Price ATC MC $16 $13 $10 $7 AVC I- Output 0 80 100 140 180 lcoct MC averane total cost ATC) average variable

Explanation / Answer

A) increase output to 140 units

the above is the answer

because here MR=MC based on curves shown

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