A firm may choose to raise price when
A)profits would increase at the higher price.
B)MR MC.
C)average profit is zero.
D)it relies on marginal analysis.

Name: A firm may choose to raise price when A)profits would increase at the higher price. B)MR > MC. C)average profit is zero. D)it relies on marginal analysis.
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Question

A firm may choose to raise price when
A)profits would increase at the higher price.
B)MR > MC.
C)average profit is zero.
D)it relies on marginal analysis.

Quizplus · Accepted Answer

When profits would increase at the higher price, it indicates that the firm can benefit from raising prices, which is a primary reason for doing so.

A Firm May Choose to Raise Price When