Profit Maximization at MR = MC

Steps:

• Identify total revenue (TR) and total cost (TC) at each output level.
• Calculate profit as TR minus TC for outputs 100, 200, 300, and 400.
• Compare profits across levels to find the maximum.
• Confirm by checking marginal revenue (MR) equals marginal cost (MC) at that point.

Why B is correct:

• At 200 units, MR equals MC, satisfying the profit-maximization rule for firms in imperfect competition.

Why the others are wrong:

• A: Profit is lower as MR > MC, so output should increase.
• C: Profit is lower as MR < MC, so output should decrease.
• D: Profit is minimized due to excessive output where MC > MR.

Not enough information: Specific TR and TC data not provided, preventing precise calculation.

Final answer: B