Producing where marginal revenue equals marginal cost is equivalent to producing where
A)average total cost equals average revenue.
B)average fixed cost is minimised.
C)total revenue is equal to total cost.
D)total profit is maximised.

Question

Quizplus · Accepted Answer

Producing where marginal revenue equals marginal cost is the profit-maximizing level of output. At this point, the additional revenue earned from producing one more unit of output just equals the additional cost incurred to produce it, resulting in the highest possible profit.

Producing Where Marginal Revenue Equals Marginal Cost Is Equivalent to Producing