Question

. The equality of MR and MC is essential for profit maximization in all market structures because if multiple choice 1 MR and MC are equal, economic profits will be zero. MR is less than MC, producing more will increase profits. MR and MC are equal, any other output level will result in reduced profits. MR is greater than MC, producing more will lower profits.

Answer 1

Answer:

MR and MC are equal, any other output level will result in reduced profits.

Explanation:

Marginal cost is the increase in the total cost as a result of producing one additional unit. Marginal revenue is the increase in revenue resulting from the sale of one additional unit. Profit-maximization is the process by which a firm determines the price and output level that will result in the largest profit. The reason behind this strategy is that the total profit reaches its maximum point where marginal revenue equals marginal cost and the firm will continue to produce until marginal profit is zero. The marginal profit equals the marginal revenue minus the marginal cost.