When MC MR there is a _____.
A) marginal gain
B) sub-optimization of profits
C) need for increased advertising
D) marginal loss
E) maximization of profits

Question

When MC > MR there is a _____.
A) marginal gain 
B) sub-optimization of profits 
C) need for increased advertising 
D) marginal loss 
E) maximization of profits

Quizplus · Accepted Answer

When marginal cost (MC) is greater than marginal revenue (MR), the firm incurs a marginal loss on each additional unit produced, as the cost of producing one more unit exceeds the revenue gained from selling it.

When MC > MR There Is a _____