Question 39 (1 point) Refer to the accompanying figure to answer the following q

Question

Question 39 (1 point) Refer to the accompanying figure to answer the following questions. Price MC $25 $13 A- $10 MR 100 150 Quantity If a firm is producing a quantity of 100 and charging a price of $25, it should raise production to 150 units but lower the price to $10 to maximize profits. should raise production to 150 units and continue to charge $25 to maximize profits. should keep production at 100 units but lower the price to $13 to maximize profits. should keep production at 100 units and lower the price to $10 to maximize profits. is already maximizing profits and should not change the price or quantity produced. Save

Explanation / Answer

Answer is Is already maximizing profits and should not change the price or quantity produced.

Explanation:

The Quantity 100 units is an equilibrium quantity as at this quantity MRM is equal to MC. Therefore, the price $25 is also an equilibrium price and the firm is maximizing profits.

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