If its marginal revenue is less than its marginal cost,a firm should reduce its output product.

Name: If its marginal revenue is less than its marginal cost,a firm should reduce its output product.
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Question

Quizplus · Accepted Answer

If the marginal revenue is less than marginal cost, it means that the firm is not making enough profit to cover the additional cost of producing one more unit. Thus, the firm should reduce its output to a level where the marginal revenue equals the marginal cost to maximize its profits.

If Its Marginal Revenue Is Less Than Its Marginal Cost,a