Question

the company econislife is deciding what output level will provide profit - maximization. according to the graph below, what level of output will maximize profit? dollars econislife total revenue and total cost

Explanation:

Step1: Recall profit - maximization condition

Profit $\pi=TR - TC$. Profit is maximized when the vertical distance between the total - revenue ($TR$) curve and the total - cost ($TC$) curve is the largest.

Step2: Observe the graph

By visually inspecting the graph of the total - revenue and total - cost functions, we can see that the largest vertical gap between the $TR$ and $TC$ curves occurs at a quantity of 50.

Answer:

50