Suppose the utility function for a firm manager is U = ? + bQ, where Q is output, ? is profit, and b is a negative constant. How would the firm's output compare with what it would be if the manager's objective was to maximize profit?

A. It would be the same as the profit-maximizing output.
B. It would be less than the profit-maximizing output.
C. It would be greater than the profit-maximizing output.
D. None of the statements is correct.


Answer: B

Economics

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