Consider Three Firms,A,B and C,all Producing Kilos of Potatoes (Per

question 118

Multiple Choice

Consider three firms,A,B and C,all producing kilos of potatoes (per year) in a perfectly competitive market.The diagrams below show marginal cost curves for each of the three firms. FIGURE 12-1
-Refer to Figure 12-1.Suppose each of Firms A,B and C are producing 500 kilos of potatoes.Keeping total output unchanged,what level of output should each firm be producing such that the industry is productively efficient?

• A)Firm A: 200 kilos,Firm B: 500 kilos,Firm C: 800 kilos
• B)Firm A: 700 kilos,Firm B: 800 kilos,Firm C: 0 kilos
• C)Firm A: 500 kilos,Firm B: 800 kilos,Firm C: 200 kilos
• D)Firm A: 500 kilos,Firm B: 500 kilos,Firm C: 500 kilos
• E)Firm A: 500 kilos,Firm B: 200 kilos,Firm C: 200 kilos

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