A profit-maximizing firm will continue to expand output:
a. as long as the revenues from the production and sale of an additional unit exceeds the average cost of the unit.
b. until the average cost of producing the good or service is at a minimum.
c. as long as the revenues from the production and sale of an additional unit exceeds the marginal cost of the unit.
d. until the marginal cost of producing a good or service is at a minimum.
c
You might also like to view...
The kinked demand curve is based on the idea that
A) you will follow my price increase but not my price cut. B) you will follow my price cut but not my price increase. C) you will follow all price changes I might initiate. D) you will not follow my behavior at all.
Which of the following is an incorrect observation? a. Import tariffs benefit domestic producers and the government, but harms domestic consumers
b. Gains from trade in terms of world output are reduced by export subsidies. c. The overall domestic employment effects of a tariff imposition are likely to be positive. d. If the imposition of a tariff leads to retaliatory tariffs by other countries, domestic employment outside the industry gaining the tariff protection would likely suffer.