To maximize profits in the off- peak period, the ______marginal revenue is set equal to the______ marginal cost.
A)off- peak; long- run
B)off- peak; short- run
C)peak; long- run
D)peak; short- run

Question

Quizplus · Accepted Answer

To maximize profits in the off-peak period, the marginal revenue should be set equal to the marginal cost in the short-run. This is because in the long-run, firms have more flexibility to adjust their production capacity and fixed costs, which may not be feasible in the short-run. Additionally, peak periods typically have higher demand and higher prices, so focusing on maximizing profits in the off-peak period is more relevant in the short-run.

To Maximize Profits in the Off- Peak Period, the ______Marginal