The profit-maximizing rule MR = MC is:
A)followed by a monopoly but not by a perfectly competitive firm.
B)followed by a perfectly competitive firm but not by a monopoly.
C)followed by all types of firms.
D)not followed by a monopoly because it would reduce economic profit to zero.

Question

Quizplus · Accepted Answer

The profit-maximizing rule where Marginal Revenue (MR) equals Marginal Cost (MC) is followed by all types of firms, including both monopolies and perfectly competitive firms, as it is a fundamental principle for maximizing profits in economics.

The Profit-Maximizing Rule MR = MC Is