As long as an additional unit of output yields a marginal revenue larger than its marginal cost, it will be adding to total profits of the firm.

Question

Quizplus · Accepted Answer

When the marginal revenue (MR) from selling an additional unit of a product is greater than the marginal cost (MC) of producing that unit, the difference contributes positively to the firm's total profits, as profits increase when revenue exceeds costs.

As Long as an Additional Unit of Output Yields a Marginal