A firm that is maximizing its profits by producing a certain level of output must also be
A)minimizing its cost of producing that output.
B)maximizing its sales.
C)minimizing its variable costs.
D)maximizing its output.
E)maximizing its revenue.

Question

Quizplus · Accepted Answer

In order to maximize profits, a firm must produce at a level where the marginal cost of production is equal to the marginal revenue generated from selling that output. At this level of output, the firm will be both maximizing its profits and minimizing its cost of production. Thus, choice A is the correct answer.

A Firm That Is Maximizing Its Profits by Producing a Certain