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Economics - Short Run Marginal Cost

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The short-run marginal cost of the Ohio Bag Company is 2Q. Price is $100. The company operates in a competitive industry. Currently, the company is producing 40 units per period. What is the optimal short-run output? Calculate the profits that Ohio Bag is losing through suboptimal output.

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The expert examines the short run marginal costs of an Ohio Bag Company. Neat and step-wise solution is provided.

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Marginal cost = Marginal Revenue (For Optimal short-run output)

2Q = 100

Q = 50 is the optimal output

Revenue = 100(40) = ...

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