For a firm, TFC=Rs 25000. TVC = 750x, where x is the units of output produced. What must be the market price so that the firm breaks even at the output level of 1250 units?

Rs 25

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Rs 50

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

Rs 100

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Rs 200

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Open in App

Solution

The correct option is B
Rs 50

Let P be the market price.

At the breakeven point, TR=TC
At the output level of 1250 units,
TR = 1250 P
TC = TFC + TVC
= Rs 25000 + 750 P

Equating TR and TC,
1250 P = 750 P + Rs 25000
500 P = Rs 25000
P = Rs 50

Suggest Corrections

Similar questions

At the market price of Rs 10, a firm supplies 4 units of output. The market price increases to Rs 30. The price elasticity of the firm’s supply is 1.25. What quantity will the firm supply at the new price?

At the market price of Rs. 10, a firm supplies 4 units of output. The market price increases to Rs. 30. The price elasticity of the firm's supply is 1.25. What quantity will the firm supply at the new price?

Q. A perfectly competitive firm has the following cost schedule

Output (units)	0	1	2	3	4	5	6	7	8	9	10
MC(Rs.)	-	11	10	9	8	7	6	5	7	13	19
TC(Rs.)	9	20	30	39	47	54	60	65	72	85	104

Suppose the price falls to Rs. 7, the firm would choose to produce ________ of output.

The cost function of a firm is given by $T C = x^{2} + 300 x + 10000$ , where x is the number of units of output. If the market price is Rs 1000, how many units must the company sell to break even?

Q. From the following data on the cost of production of a firm calculate TFC,AFC,TVC, AVC and MC:

Output(kg)	0	1	2	3	4	5	6
TC(Rs.)	$60$	$80$	$100$	$111$	$116$	$130$	$150$

Join BYJU'S Learning Program

For a firm, TFC=Rs 25000. TVC = 750x, where x is the units of output produced. What must be the market price so that the firm breaks even at the output level of 1250 units?

The correct option is B Rs 50 Let P be the market price. At the breakeven point, TR=TC At the output level of 1250 units, TR = 1250 P TC = TFC + TVC = Rs 25000 + 750 P Equating TR and TC, 1250 P = 750 P + Rs 25000 500 P = Rs 25000 P = Rs 50

The correct option is B
Rs 50

Let P be the market price.

At the breakeven point, TR=TC
At the output level of 1250 units,
TR = 1250 P
TC = TFC + TVC
= Rs 25000 + 750 P

Equating TR and TC,
1250 P = 750 P + Rs 25000
500 P = Rs 25000
P = Rs 50