The point of maximum profit for a business firm is where:
A) P = AC.
B) TR = TC.
C) MR = AR.
D) MR = MC.

Question

Quizplus · Accepted Answer

The point of maximum profit for a business firm is where MR (Marginal Revenue) = MC (Marginal Cost). This is because at this point, the cost of producing one more unit is equal to the revenue earned from selling that unit, maximizing the profit of the firm. Options A, B, and C do not take into account the concept of marginal analysis and therefore do not provide an accurate point of maximum profit.

The Point of Maximum Profit for a Business Firm Is