A profit-maximizing price searcher will expand output to the point where a. marginal revenue equals marginal cost. b. price equals marginal cost. c. total revenue equals total cost. d. price equals average total cost.
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This is because at this point, the firm is maximizing its profit by producing the quantity of output where the additional revenue from selling one more unit (marginal revenue) is equal to the additional cost of producing one more unit (marginal cost). Show more…
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