Question : Consider a competitive firm with a marginal cost given by : 6740
Consider a competitive firm with a marginal cost given by c'(q) = 20 + 10q, an average variable cost given by c_v(q)/q = 20 + 5q and fixed costs of F = $500. What is the firm's total cost function? If the market price for the firm's good is $100, what is the firm's profit-maximizing output? How would a 40 percent tax rate on profits affect this optimizing choice of production? If no taxes are imposed, is the firm making an economic profit?