The profit maximizing level of output for the firm is whereSelect an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.amarginal revenue exceeds marginal cost by the greatest possible amountbmarginal revenue equals marginal cost for the last unit produced.caverage revenue equals average total cost for the last unit produced.dmarginal revenue equals the minimum point of the average variable cost curve.
Question
The profit maximizing level of output for the firm is whereSelect an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.amarginal revenue exceeds marginal cost by the greatest possible amountbmarginal revenue equals marginal cost for the last unit produced.caverage revenue equals average total cost for the last unit produced.dmarginal revenue equals the minimum point of the average variable cost curve.
Solution 1
The profit maximizing level of output for the firm is where marginal revenue equals marginal cost for the last unit produced. This is because when marginal revenue equals marginal cost, the firm is maximizing its profit. If marginal revenue was higher than marginal cost, the firm could increase profit by producing more. If marginal cost was higher than marginal revenue, the firm could increase profit by producing less. Therefore, the point where they are equal is the profit maximizing level of output.
Solution 2
The profit maximizing level of output for the firm is where marginal revenue equals marginal cost for the last unit produced. This is because when marginal revenue equals marginal cost, the firm is maximizing its profit. If marginal revenue was higher than marginal cost, the firm could increase profit by producing more. If marginal cost was higher than marginal revenue, the firm could increase profit by producing less. Therefore, the correct answer is b) marginal revenue equals marginal cost for the last unit produced.
Similar Questions
The profit maximizing level of output for the firm is whereSelected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer.amarginal revenue (MR) exceeds marginal cost (MC) by the greatest possible amount.bmarginal revenue(MR) equals marginal cost (MC) for the last unit produced.caverage revenue (AR) equals average total cost (ATC) for the last unit produced.dmarginal revenue (MR) equals the minimum point of the average variable cost (AVC) curve.
A profit-maximizing monopolist produces where marginal cost is equal to ________.Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.apricebmarginal revenuec0dthe minimum
A firm's total revenue can be found bySelected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer.amultiplying the price of the product times the quantity demanded of the good, and then subtracting the cost of producing the good.bmultiplying the cost of producing the good times the quantity demanded.cmultiplying the quantity purchased times the price of the good.ddividing the total cost of production by the number of units of output produced.
The figure below shows the marginal cost and average total cost curves for a perfectly competitive firm. If the market price is $10, thenSelected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer.amarginal cost always equals marginal revenue for each unit sold.bthe firm earns $10 profit on each unit sold.cmarginal revenue equals $10.dthe firm earns $8 profit on each unit sold.
For a firm in a perfectly competitive market, average revenue equals ________.Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.athe market pricebaverage total costcfixed costdprice divided by quantity
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.