fast please 37. ### Figure 9.1 ExplanationThis graph illustrates the cost structure of a firm in a perfectly competitive market, displaying three key curves: Marginal Cost (MC), Average Total Cost (ATC), and Average Variable Cost (AVC) against the quantity produced (Q).#### Key Components:- **MC (Marginal Cost)**: The upward-sloping curve shows the cost of producing one additional unit of output. It intersects both the AVC and ATC curves. - **ATC (Average Total Cost)**: This U-shaped curve indicates the total cost per unit of output, which includes both fixed and variable costs. - **AVC (Average Variable Cost)**: Also U-shaped, this curve shows the variable cost per unit of output, excluding fixed costs.#### Price and Output:- Market Price: $40 (horizontal line at the 40 mark on the vertical axis)- Profit Maximizing Output Level: Where MR (equal to market price in perfect competition) equals MC; shown at a quantity around 650 on the graph.#### Profit Calculation:To find the firm's profit, we analyze the difference between total revenue and total cost at the profit-maximizing output level.- **Total Revenue (TR)**: Calculated as Price ($40) times Quantity (650).- **Total Cost (TC)**: Calculated using the ATC at the given output level. At quantity 650, ATC is approximately $30 per unit.\[ \text{Profit} = (\text{Price} - \text{ATC}) \times \text{Quantity} \]\[ \text{Profit} = (40 - 30) \times 650 = 10 \times 650 = 6,500 \]However, please verify using correct data from the graph or context for actual educational purposes, as the position and numbers may need precise confirmation from the figure.#### Answer Choices:A. $7,200 B. $9,000 C. $27,000 D. $36,000 According to this information, the firm's profit is calculated in context with the selected answer being closest to the calculated profit.

The perfectly competitive market refers to market where large number of buyers and sellers exist in…

Figure 9.1 shows the cost structure of a firm in a perfectly competitive market. If the market price is $40 and the fir s currently producing the profit maximizing output level, the firm's profit is: O A. $7,200. O B. $9,000. OC. $27,000. $36.000

Figure 9.1 shows the cost structure of a firm in a perfectly competitive market. If the market price is $40 and the fir s currently producing the profit maximizing output level, the firm's profit is: O A. $7,200. O B. $9,000. OC. $27,000. $36.000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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