According to the Rational Rule for Sellers, a seller should choose the output level where _____ and the price level _____.
A)marginal cost equals marginal revenue; that is on the seller's demand curve at that output level
B)maximum revenue is obtained; that is on the seller's demand curve for that output
C)average total cost is minimum; that is associated with maximum revenue
D)sales are maximum; where revenue is maximum

Question

Quizplus · Accepted Answer

The Rational Rule for Sellers suggests that a seller should produce at an output level where marginal cost equals marginal revenue, which means that the seller is producing at the point where they are earning the highest possible profit. This point is on the seller's demand curve at that output level. Therefore, option A is the correct answer.

According to the Rational Rule for Sellers, a Seller Should