The ajax manufacturing company is selling in a purely competitive market. its output is 100 units, which sell at $4 each. at this level of output, total cost is $600, total fixed cost is $100, and marginal cost is $4. the firm should
a. reduce output to about 80 unitsb. expand its productionc. continue to produce 100 unitsd. produce zero units of output

The correct answer is option D.

Explanation:

The total cost of the firm is $600.

The fixed cost is $100.

The variable cost will be

=Total costs-fixed costs

=$(600-100)

=$500.

The average variable cost will be

=total variable costs/quantity of outputs

=$500/100

=$5 per unit

The price is $4.

So, we see the price is not covering the average variable cost. This means the firm is incurring losses. The firm will thus produce zero units of output.

answer; (c) canada,mexico and the united states. i do believe this is the correct answer; /// good luck

answer; maintain a safe following distance;