Table 9-4 Table 9-4 Shows the Short-Run Cost Data of a Perfectly

question 288

Multiple Choice

Table 9-4
$\begin{array}{|c|c|c|c|}\hline \text { Quantity } & \begin{array}{c}\text { Average } \\\text { Fixed Cost }\end{array} & \begin{array}{c}\text { Average } \\\text { Variable Cost }\end{array} & \begin{array}{c}\text { Marginal } \\\text { Cost }\end{array} \\\hline 20 & \$ 40 & \$ 18 & \$ 18 \\\hline 40 & 20 & 14 & 10 \\\hline 60 & 13.1 & 16 & 20 \\\hline 80 & 10 & 22 & 40 \\\hline 100 & 8 & 30 & 62 \\\hline 120 & 6.61 & 40 & 90 \\\hline\end{array}$ Table 9-4 shows the short-run cost data of a perfectly competitive firm. Assume that output can only be increased in batches of 20 units.
-Refer to Table 9-4.If the market price is $45,the firm

• A) earn a profit of $3,600.
• B) will suffer a loss of $200.
• C) will break even.
• D) will earn profit of $1,040.

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