(Answered) Suppose that a competitive firms marginal cost of producing

Economics

Suppose that a competitive firm"s marginal cost of producing output q is given by MC(q) = 3 + 2q. Assume that the market price of the firm"s product is $9.

a. What level of output will the firm produce?

b. What is the firm"s producer surplus?

c. Suppose that the average variable cost of the firm is given by AVC(q) = 3 + q. Suppose that the firm"s fixed costs are known to be $3. Will the firm be earning a positive, negative, or zero profit in the short run?

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Microeconomics, Economics

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