Homework Answers
For the perfect competition market profit is maximized at a point where Price is equal to Marginal Cost.
At profit maximizing condition output is 5 unit.
Price = 10
Average Cost is the per unit cost of production is $7
Profit = TR - TC
= P * Q - AC * Q
= 10 *5 - 7 *5
= $50 - $35
= $15
Option C is correct.
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