In a Perfectly Competitive Industry, There Are Two Types of Firms

Multiple Choice

In a perfectly competitive industry, there are two types of firms: low-cost producers and high-cost producers. The minimum average total cost of the high-cost producers is $150. The low-cost producers have a long-run total cost curve given by LTC = 150Q - 15Q² + 0.4Q³, where LMC = 150 - 30Q + 1.2Q². How much economic rent does the low-cost producer earn?

A) $3,125
B) $14,000
C) $710
D) $45,000