select the correct location on the graph. john is a producer in a perfectly competitive market structure…
select the correct location on the graph. john is a producer in a perfectly competitive market structure. identify the point where he will set his output.
Answer
Explanation:
Step1: Recall profit - maximization rule
In a perfectly competitive market, a producer maximizes profit when marginal cost (MC) equals marginal revenue (MR).
Step2: Identify the point on the graph
On the graph, find the intersection point of the marginal cost curve and the marginal revenue curve. This is the point where the producer will set his output.
Answer:
The point of intersection of the marginal cost and marginal revenue curves on the graph.