A profit-maximizing firm expands output until marginal revenue equals the _____ of producing the last unit.
A)marginal cost
B)average variable cost
C)average total cost
D)average fixed cost

Question

Quizplus · Accepted Answer

A profit-maximizing firm expands output until marginal revenue equals marginal cost, not any of the average costs. The other average costs (B, C, D) are not directly used to determine the profit-maximizing quantity of output.

A Profit-Maximizing Firm Expands Output Until Marginal Revenue Equals the _____