Marginal analysis:
A) can be very useful if a firm's pricing objective is profit maximization.
B) focuses on the last unit which will be sold.
C) can be used to find the most profitable price and quantity.
D) can help find the price that results in the greatest difference between total revenue and total cost.
E) All of these alternatives are correct.

Question

Quizplus · Accepted Answer

All of these alternatives are correct. Marginal analysis allows a firm to analyze the costs and revenues associated with producing additional units, which can aid in finding the most profitable price and quantity, as well as determining the price that results in the greatest difference between total revenue and total cost. This is especially useful if the firm's pricing objective is profit maximization. Therefore, all of the options provided in the question are correct.

Marginal Analysis