Marcia is a fashion designer who runs a small clothing business in a competitive industry.Marcia specializes in making designer dresses.Marcia sells 10 dresses per month.Her monthly total revenue is $5,000.The marginal cost of making a dress is $400.In order to maximize profits,Marcia should

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In order to maximize profits, Marcia should produce where marginal revenue equals marginal cost. Since the marginal cost of producing a dress is $400 and she sells each dress for $500, her marginal revenue is $500 as well. In other words, she is making a profit of $100 per dress. Therefore, if she produces more than 10 dresses per month, she will increase her total revenue and profits.

Marcia Is a Fashion Designer Who Runs a Small Clothing