When making a profit-maximizing "how much" decision, if the price of a good or service is less than its marginal cost, the individual can make herself better off by:

Question

Quizplus · Accepted Answer

If the price of a good or service is less than its marginal cost, it means that producing an additional unit of the good or service would cost more than it would bring in revenue. Therefore, the individual should decrease the amount of the good or activity until the price of one more unit is greater than the marginal cost. This way, they can maximize their profit by producing only the units that bring in more revenue than they cost to produce. Choice A is the best option as it suggests decreasing the amount of the good or activity as long as the price of one more unit is less than the marginal cost.

When Making a Profit-Maximizing "How Much" Decision, If the Price