Assume a competitive price-searcher firm is earning an economic profit. The marginal revenue from selling an additional unit is $30 and the marginal cost of producing that additional unit is $23. The firm should
A) change neither its price nor its output level
B) reduce its price and increase its output level
C) increase its price and reduce its output level
D) reduce both its price and its output level
E) increase both its price and its output level
Correct Answer:
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