-Refer to Figure 9-4

Multiple Choice

-Refer to Figure 9-4. The firm represented in the diagram is currently sellingQ_a units at a price of $P_a. Is this firm maximizing its profit and if it is not, what would you recommend to the firm?

A) No, it is not; it should lower its price to $P_b and sell Q_b units.
B) Yes, it is maximizing its profit by charging the highest price possible.
C) No, it is not; it should lower its price to $P_c and sell Q_c units.
D) No, it is not; since its marginal cost is constant, it should produce and sell as much as it can. It should sell Q_d units at a price of $P_d.