Answer to Question #5170 in Microeconomics for xyzmjpatel86

Question

Let MC = 8+6Q and let MR = AR = P be fixed at P=20. What is the profit maximising output
for this firm?

Answer 1

Let MC = 8+6Q and let MR = AR = P be fixed at P=20. What is the profit maximizing output for this firm?
The equilibrium condition is: MR=MC. In our case we have perfectly competitive firm: P=MC=AR.
MC=MR=P
8+6Q=20 Q=2;