Suppose that Maggie's Farm Organics, a perfectly competitive firm, is producing an Output equal to 8,000 pounds of tomatoes. At this Output level, it finds that its Marginal Revenue (MR) equals $3.00 and that its Marginal Cost equals $2.00. Given this information, Maggie's Farm should: Select one: a. shut down. b. increase its Price. c. increase its Output. d. decrease its Output.
Suppose that Maggie's Farm Organics, a perfectly competitive firm, is producing an Output equal to 8,000 pounds of tomatoes. At this Output level, it finds that its Marginal Revenue (MR) equals $3.00 and that its Marginal Cost equals $2.00. Given this information, Maggie's Farm should: Select one: a. shut down. b. increase its Price. c. increase its Output. d. decrease its Output.
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter13: Firms In Competitive Markets
Section: Chapter Questions
Problem 8PA
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