If a Firm Spends $200 to Produce 20 Units of Output

question 94

Multiple Choice

If a firm spends $200 to produce 20 units of output and spends $440 to produce 40 units of output,then the marginal cost of increasing output is:

• A)$22.
• B)$12.
• C)$20.
• D)$10.

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Definitions:

Market Supply

The total amount of a specific good or service that is available to consumers at current prices in a given market.

Long-Run Equilibrium

A state in which all firms in a market are making normal profits and there is no incentive for market entry or exit, usually achieved in the long term.

Demand Increases

Situations or conditions that lead to a rise in the quantity of a product or service that consumers are willing and able to purchase.

Market Supply

The total quantity of a good or service that all producers in a market are willing and able to sell at various prices.