What rule(s) should a firm follow in deciding optimum output for profit maximization?

The firm should expand its output as long as the added output contributes more to total revenue than it does to total cost, which means the spread between total revenue and total cost (that difference is profit) is increasing. The additions to TR and TC per unit of output are MR and MC, respectively. Output should optimally be set where MR and MC are equal; this occurs where TR ? TC = PROFIT is at a maximum.

Economics

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The decline in the value of the dollar from 1985 to 1988 was beneficial to

A. American tourists travelling to Europe. B. firms importing goods into America. C. American exporting businesses. D. foreigners holding U.S. government bonds.

Economics

Assume the economy begins at the intersection of D0 S0. Suppose the government then instituted strong emission standards. How would this affect the supply curve?


A. Move along S0
B. Shift to S1
C. Shift to S2
D. No change

Economics