Question

The point where marginal cost curve crosses the ____________ and ___________ curve is where the profit maximizing quantity demanded (dropping down to the X-axis) and price (going up to the demand curve or average revenue curve and over to the Y-axis) are determined.

Answer 1

Answer:

This question is incomplete, the options are missing and the word "and" between the gaps is wrong and should not be there.

The options are the following:

a) Marginal revenue

b) Average revenue

c) Variable cost

d) Fixed cost

And the correct answer is the option A: Marginal revenue.

Explanation:

To begin with, in the microeconomics theory the marginal analysis is very well known for being one of the reasons why the price is determined in the markets under the laws of economic sciences. Moreover, this marginal analysis focus on the interaction between all the curves that represents the costs and revenues that are related to the consumer of a good or service in a particular market. In the graphic, the point where the marginal cost curve equals the marginal revenue curve is where the profit maximizing quantity demanded and the price are the same and therefore those are the equilibrium numbers.