Fresh Laundry is a firm that produces laundry detergent. The table above summarizes Fresh Laundry's product quality marg revenue and marginal cost at various quality levels.
-Refer to the table above. If Fresh Laundry is currently producing 4 quality units, to maximize profit, Fresh Laundry should ______the number of quality units as the current quality marginal revenue is______ than its marginal cost.

Question

Quizplus · Accepted Answer

To maximize profit, a firm should produce where marginal revenue (MR) equals marginal cost (MC). If MR is greater than MC, the firm can increase profit by producing more.

Fresh Laundry Is a Firm That Produces Laundry Detergent