객관식
The marginal benefit of an activity can be found by calculating the change in:
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0. Basic Principles of Economics
Marginal Analysis
객관식
If a firm is producing at a quantity of output where marginal revenue exceeds marginal cost, then which of the following is true?
A
The firm should decrease its output to maximize profit.
B
The firm is already maximizing profit at this output level.
C
The firm should increase its output to maximize profit.
D
The firm should shut down production immediately.
검증된 단계별 안내1
Recall the profit maximization rule: a firm maximizes profit by producing the quantity where marginal revenue (MR) equals marginal cost (MC), i.e., $MR = MC$.
Understand the meaning of $MR > MC$: producing one more unit adds more to revenue than it adds to cost, so increasing output will increase profit.
Analyze the implication: since $MR > MC$, the firm is not yet maximizing profit because producing more units will increase total profit.
Conclude that the firm should increase its output to move closer to the profit-maximizing quantity where $MR = MC$.
Recognize that decreasing output or shutting down is not optimal here because those actions would reduce profit when $MR > MC$.
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