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Which Statement Explains the Logic of the Profit-Maximization Rule for a Perfectly

Question 149

Multiple Choice

Which statement explains the logic of the profit-maximization rule for a perfectly competitive firm?


A) Since it must charge the market equilibrium price, the firm should produce and sell maximum output.
B) The firm should choose the output level with a minimum ATC so that it earns maximum profit per unit of output.
C) The firm should produce every unit of output that adds more to revenue than it adds to costs so that the firm captures all the available profit.
D) The firm should reduce price by 1% for every 1% increase in output.

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