Question

The graph shows the marginal cost and average total cost curves for a perfectly competitive firm. The horizontal axis measures output in thousands of units per year, from 0 to 50, increasing by 10. The vertical axis measures the revenue and cost in dollars per unit, from 0 to $25, increasing by $5. The graph shows two U-shaped curves, labeled MC and ATC. The minimum point of the ATC curve corresponds to an output of 30 and a cost of 10. The minimum point of the MC curve corresponds to an output of 15 and a cost of $4.50. The MC curve starts below the ATC curve. The upward-sloping portion of the MC curve intersects the ATC curve at its minimum point. The combinations of output and cost along the MC curve are (10, 5), (20, 5), (30, 10), and (40, 20). The combinations of output and cost along the ATC curve are (10, 22), (20, 12), (30, 10), (40, 13), and (50, 24). The above figure shows a perfectly competitive firm. If the market price is​ $15, the firm A. is making zero economic profit. B. is incurring an economic loss. C. might shut down but more information is needed about the AVC. D. is making an economic profit. E. will immediately shut down. Please answer before 12am...it's the cut-off time

Answer 1

The answer is option (D).