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CUET Economics 2025 PYQs16 May Shift 1. Free, no login required.

Micro

past year questions, CUET Economics 2025 16 May Shift 1

Production & Costs

past year questions, Micro, CUET Economics 2025 16 May Shift 1

Medium

If the marginal cost(MC) of a perfectly competitive firm is as given below and the price of the product is Rs 15, find the profit-maximizing output of the firm.

output123456
MC181510121524

Solution

✅ Correct Option: 3

Option 1 -> At output 2, MC = 15 = Price, but MC is falling afterward (drops to 10 at output 3), so not profit-maximizing.

Option 2 -> At output 3, MC = 10 < Price (15), so the firm should continue producing more units.

Option 3 -> At output 5, MC = 15 = Price, and MC is rising (from 12 to 15), satisfying the profit-maximizing condition.

Option 4 -> At output 6, MC = 24 > Price (15), so producing this unit reduces profit.

Hence, Option 3 (Output = 5) -> A perfectly competitive firm maximizes profit where MC = Price and MC is rising. At output 5, MC equals the price (Rs 15), and the marginal cost is increasing from the previous unit (MC was 12 at output 4). This ensures the firm is at the optimal production level where the last unit produced adds exactly as much to revenue as it does to cost. -> correct

Related questions:

2025: 3 June Shift 1

Identify the correct statements from the following:

(A) As long as MP>AP, the average Product (AP) can rise even when the Marginal Product (MP) is falling.

(B) The law of variable proportions operates only if the factor ratio happens to change.

(C) Total Product (TP) must increase no matter if there are increasing or decreasing returns to a factor.

(D) Marginal Product (MP) = Average Product (AP), when AP is maximum.

Choose the correct answer from the options given below:

2025: 28 May Shift 1

The shape of the average product and marginal product curves are...................

  1. Both Inverse 'U' Shaped
  2. Both 'U' Shaped
  3. AP 'U' Shaped and MP Inverse 'U' Shaped
  4. MP 'U' Shaped and AP Inverse 'U' shaped

2026: 11 May Shift 1

Which of the following cost curve represents the rate of change in the total cost of production in the production function?

2025: 13 May Shift 2

In which of the following conditions, output increases with the same proportion of input?

2025: 30 May Shift 2

The point of minimum average cost at which the supply curve cuts the long run average cost curve is called?

2026: 6 June Shift 1

The marginal product of an input factor initially rises with its employment level and then, after a certain level of employment, it starts falling. this is known as:

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