If a perfectly competitive firm is producing 500 units of output and the marginal revenue from producing the 500th unit of output is $3 and the marginal cost is $3.50, which of the following is true?
A) The firm should increase production.
B) The firm is producing the profit-maximizing output.
C) The firm is earning a profit from producing the 500th unit.
D) The firm should decrease production.
Correct Answer:
Verified
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