Total profit will be maximized:

Question

Quizplus · Accepted Answer

When marginal revenue equals marginal cost, it means the firm is operating at the point where the last unit produced generates the same revenue as the cost of producing that unit. This is the optimal point for profit maximization because if the firm were to produce more than this point, the marginal cost would be higher than the marginal revenue and decrease profit. Conversely, if the firm were to produce less than this point, the marginal revenue would be higher than the marginal cost, leading to an untapped opportunity for higher profit. Therefore, the point where marginal revenue equals marginal cost is the optimum point for maximizing profit.

Total Profit Will Be Maximized