Struggling with Econ? Firm Producing 10 Units, Profit $50

[cowgiljl]

Suppose a firm in a perfectly competive industry is producing a output of 10 units. The firms total revenue at this output is $80 and its total cost is $30. The firms marginal cost associated with the 11 unit of a output is $12. What can i say about an increase in production should it produce 11 unit or no

this is what i have
output TC MC
10 $30 $3 per unit
11 $42 $12 per unit

profit is $50

@10 units = 30/10 = $3
@11 unit = 42/11 = $3.80

it should not increase production because the cost more per unit to make

did i go about this right?
thanks joe

 

[AKG]

I'm not sure, but I think it would depend on the marginal revenue (if there is such a thing) associated with the 11th unit. And is profit/unit of real concern, or net profit? I would think it would be profit. Of course, if this is a homework question, it really depends on what your teacher expects and has taught you.

 

[M98Ranger]

Yes, you are correct. Based on the information provided, it would not be profitable for the firm to produce 11 units. The marginal cost of producing an additional unit is higher than the marginal revenue, so the firm would actually incur a loss by producing 11 units. Therefore, it would be more beneficial for the firm to continue producing 10 units and maintain a profit of $50.