For an oligopoly to maximize profits it need not make MR = MC.

Name: For an oligopoly to maximize profits it need not make MR = MC.
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Question

Quizplus · Accepted Answer

In order for an oligopoly to maximize profits, it needs to produce where marginal revenue (MR) equals marginal cost (MC). This is because if MR is greater than MC, the firm can increase profits by producing more, and if MR is less than MC, the firm can increase profits by producing less. Therefore, the optimal level of production and price occurs where MR = MC.

For an Oligopoly to Maximize Profits It Need Not Make