In: Economics
Assume a certain firm is producing Q = 1,000 units of output. At Q = 1,000, the firm's marginal cost equals $20 and its average total cost equals $25. The firm sells its output for $30 per unit. At Q = 999, the firm's total costs is $______________. Why?
Ans) At Q = 999, the firm's total costs is = $ 24,980
Total cost ( at Q = 1000) = 25* 1000 = 25,000
Subtract marginal cost
Total cost ( at Q = 999) = 25,000 - 20 = 24,980