In the Baumol model,the total quantity sold will usually be larger than
A)if perfect competition prevailed.
B)if total costs were minimized.
C)if profit were maximized.
D)if companies were interdependent.

Question

Quizplus · Accepted Answer

In the Baumol model, firms prioritize sales revenue over profit maximization. Thus, the total quantity sold is usually larger than if profit were maximized, because firms might sell more at a lower price to increase sales volume, even if it doesn't lead to the highest possible profit.

In the Baumol Model,the Total Quantity Sold Will Usually Be