Consider three firms, A, B and C, all producing kilos of potatoes (per year). The diagrams for the marginal cost curves for each of the three firms are shown. Suppose that the total quantity for the market is 1200 kilos of potatoes. Keeping total output unchanged, what level of output should each firm be producing such that the industry is productively efficient? Assume all the points are on the marginal cost curve. O A. Firm A: 400 kilos, Firm B: 400 kilos, Firm C: 400 kilos B. Firm A: 550 kilos, Firm B: 650 kilos, Firm C: 0 kilos O C. Firm A: 150 kilos, Firm B: 400 kilos, Firm C: 650 kilos O D. FirmA: 400 kilos, Firm B: 400 kilos, Firm C: 150 kilos O E. Firm A: 400 kilos, Firm B: 650 kilos, Firm C: 150 kilos Cost ($) Cost ($) Cost ($) 2+ 2+ 150 150 Firm A 400 Quantity of potatoes Firm B 550 400 Quantity of potatoes Firm C 400 Quantity of potatoes 650 650 MCA MC₂ 750 MCC Q ✓ ON Q Q
Consider three firms, A, B and C, all producing kilos of potatoes (per year). The diagrams for the marginal cost curves for each of the three firms are shown. Suppose that the total quantity for the market is 1200 kilos of potatoes. Keeping total output unchanged, what level of output should each firm be producing such that the industry is productively efficient? Assume all the points are on the marginal cost curve. O A. Firm A: 400 kilos, Firm B: 400 kilos, Firm C: 400 kilos B. Firm A: 550 kilos, Firm B: 650 kilos, Firm C: 0 kilos O C. Firm A: 150 kilos, Firm B: 400 kilos, Firm C: 650 kilos O D. FirmA: 400 kilos, Firm B: 400 kilos, Firm C: 150 kilos O E. Firm A: 400 kilos, Firm B: 650 kilos, Firm C: 150 kilos Cost ($) Cost ($) Cost ($) 2+ 2+ 150 150 Firm A 400 Quantity of potatoes Firm B 550 400 Quantity of potatoes Firm C 400 Quantity of potatoes 650 650 MCA MC₂ 750 MCC Q ✓ ON Q Q
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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