For a Certain Firm, the 100th Unit of Output That

question 44

Multiple Choice

For a certain firm, the 100th unit of output that the firm produces has marginal revenue equal to $10 and a marginal cost of $7. It follows that

• A) the production of the 100th unit of output increases the firm's profit by $3.
• B) the production of the 100th unit of output increases the firm's average total cost by $7.
• C) the firm's profit-maximizing level of output is less than 100 units.
• D) the production of the 110th unit of output must increase the firm's profit by less than $3.