To maximize profit, a perfectly competitive firm
A) should sell the quantity of output determined by the interaction between industry demand and supply.
B) should sell the quantity of output that results in a value for total revenue that is equal to total cost.
C) should produce the quantity of output that results in the greatest difference between total revenue and total cost.
D) should produce the quantity of output that results in the greatest difference between marginal revenue and marginal cost.
Answer: C
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The slope of the consumption function is equal to:
A) the marginal propensity to consume. B) autonomous consumption. C) the marginal propensity to save. D) zero.
The above table shows Priscilla's marginal utility from the two goods she consumes, pizza and Pepsi. Initially, a slice of pizza costs $4 and a can of Pepsi $2. Suppose Priscilla has $12 to spend
If the price of pizza falls to $2, Priscilla will choose to A) consume more pizza. B) consume more Pepsi. C) consume less pizza. D) Both answers A and B are correct.
In Figure 6-3(a), demand is
A. perfectly elastic. B. perfectly inelastic. C. unit elastic. D. fixed at one particular quantity.
Suppose, Nelson & Robinson, a renowned manufacturer of herbal products, introduces 16 new varieties of facial cleansers and shower gels within the same year. This will allow the company to dominate the shelf space at retail stores and crowd out new entrants in this market
Indicate whether the statement is true or false