The Case in Point on hockey teams suggested that if a sports team had a large enough stadium, it would maximize its profits by selling that quantity of tickets per game where marginal revenue was:
A) the highest possible.
B) rising over the relevant range.
C) equal to marginal cost and both were equal to zero.
D) equal to total revenue.

Question

Quizplus · Accepted Answer

In order to maximize profits, a sports team should sell the quantity of tickets per game where marginal revenue is equal to marginal cost, and both are equal to zero. This is because at this point, the team is producing at the most efficient level, and any further increase in output would result in a decrease in profit. Therefore, choice C is the best answer.

The Case in Point on Hockey Teams Suggested That If