Use the following to answer question:
-(Figure: Marginal Decision Rule) Use Figure: The Marginal Decision Rule.To the left of point C (e.g. ,at q₁) :

Question

Use the following to answer question: -(Figure: Marginal Decision Rule)Use Figure: The Marginal Decision Rule.To the left of point C (e.g. ,at q₁):

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To the left of point C, the firm is not maximizing profits because it has not yet reached the point where marginal cost (MC) equals marginal revenue (MR), which is necessary for profit maximization. Producing more until MC equals MR (at point C) would increase profits.

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