In order to maximize profits, a firm that can sell all it wants without affecting price should produce
a. where average variable costs are minimized.
b. where marginal cost is equal to average variable costs.
c. where marginal cost is equal to price.
d. where marginal cost is a minimum.
c
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NAFTA benefited Canadian consumers because:
a. of higher wages and more travel opportunity. b. of lower wages but also lower taxes. c. of lower prices but lower quality. d. of lower prices and increased variety.
A recent outbreak of hepatitis was linked to a national fast-food restaurant chain. This is an example of a case in which
a. brand name identity increases the effectiveness of markets. b. brand name identity can be detrimental to the profitability of a firm. c. advertising is ineffective in salvaging perceptions of product quality. d. advertising cannot be used to establish brand loyalty.