Refer to the data provided in Table 9.2 below to answer the question(s) that follow.
Table 9.2
Refer to Table 9.2. The market price is $42 and this firm is producing four units of output. Which of the following would you recommend to this firm?
A. Increase output to six units so that marginal cost equals marginal revenue.
B. Reduce price to $17 so that marginal cost will equal marginal revenue at 4 units of output.
C. Increase output to seven units so that price is less than marginal cost.
D. Continue producing four units of output, because the firm is able to make an economic profit.
Answer: A
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