The first-order conditions for profit maximization in a perfectly competitive market are: A) P − (dC(Q)/dQ) = 0. B) (dR(Q)/dQ) − (d²C(Q)/dQ²) (dC(Q)/dQ).

Question

The first-order conditions for profit maximization in a perfectly competitive market are: A) P − (dC(Q)/dQ) = 0. B) (dR(Q)/dQ) − (d²C(Q)/dQ²) < 0. C) P − (d²C(Q)/dQ²) = 0. D) P > (dC(Q)/dQ).

Quizplus · Accepted Answer

The first-order condition for profit maximization in a perfectly competitive market is that the price (P) equals the marginal cost (MC), which is the derivative of the cost function with respect to quantity (Q), hence P − (dC(Q)/dQ) = 0.

The First-Order Conditions for Profit Maximization in a Perfectly Competitive