Use the information in the table for a competitive firm toanswer the following q

Question

Use the information in the table for a competitive firm toanswer the following questions. 1. At a production level of 4 units, which of the following istrue? a. Marginal cost is $6 b. Total revenue is greater than variable cost c. Marginal revenue is less than marginal cost d. The firm is maximizing profit. 2. The maximum profit available to this firm is a. $2 b. $3 c. $4 d. $5 3. If the firm finds that its marginal cost is $11, itshould a. increase production to maximize profit. b. increase the price of the product to maximize profit. c. advertise to attract additional buyers to maximizeprofit. d. reduce production to increase profit.

Explanation / Answer

1.B 2.D 3.The answer is D reduce production to increase profit. That is #3.

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