If a competitive firm maximizes short-run profits by producing some quantity of output,which of the following must be TRUE at that level of output?

Question

Quizplus · Accepted Answer

In a competitive market, a firm maximizes profit where price (p) equals marginal cost (MC), which is also where marginal revenue (MR) equals MC since price equals MR for a competitive firm. Additionally, for production to be viable in the short run, price must cover average variable costs (AVC).

If a Competitive Firm Maximizes Short-Run Profits by Producing Some