If a perfectly competitive firm is producing a quantity that generates P MC, then profit:

Question

If a perfectly competitive firm is producing a quantity that generates P > MC, then profit:

Quizplus · Accepted Answer

In a perfectly competitive market, if the price (P) is greater than the marginal cost (MC) of production, the firm can increase its profits by producing more. This is because the additional cost of producing one more unit (MC) is less than the revenue gained from selling that unit at the market price (P), thus increasing overall profit.

If a Perfectly Competitive Firm Is Producing a Quantity That