Question

A perfectly competitive firm producing 100 units of output per period finds that: average total cost is $20; average variable cost is $12; marginal cost is $18 and increasing; price of the product is $15. this firm should

Answer 1

This is the concept of business mathematics. The question requires us to calculate the profit margin given the that the cost of production is $20, variable cost is $12 and marginal cost is $18. Also we are told that the price per product is $15.
Profit=Revenue-Cost
Revenue=100*15=$1500
Total cost=20+12+18=$50
Therefore the profit margin will be:
1500-50
=$1450