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Assume that a perfectly competitive firm has the following revenue and cost functions:
TC= 5625 +5Q + 0.01Q^2
AVC=5 + 0.01Q
MC=5 + 0.02Q
TR=20Q
A) what is the level of output that maximizes profits, if any? Compute profit, if any?
B) Should this firm continue producing if MR falls to $10? Explain
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