Assume a firm operating under perfectly competitive market structure has atotal cost function of TC=72+4Q+2Q^.If The Market Price Of The Product Is 26
, How Many Units Of Output Will The Firm Produce?
The firm will produce 8 units of output. This can be calculated by setting the market price equal to the marginal cost and solving for Q:
MC = 26
4 + 4Q = 26
Q = 8