• # question_answer Given below is the cost schedule of a product produced by a firm. The market price per unit of the product at all levels of output is Rs 12. Using marginal cost and marginal revenue approach, find out the level of equilibrium output. Give reasons for your answer: Output (Units) 1 2 3 4 5 6 Average (Cost) (Rs) 12 11 10 10 10.4 11

 Output AR (Rs.) TC (Rs.) 1 20 22 2 20 42 3 20 60 4 20 76 5 20 96 6 20 120 MR MC 20 22 20 20 20 22 20 26 20 20 Equilibrium 20 36 At ${{5}^{th}}$ unit of output, the producer will be in equilibrium because at this unit, MR is equal to MC and MC curve cuts MR from below.