If at Its Current Production Level, a Dominant Firm's Marginal

question 59

Multiple Choice

If at its current production level, a dominant firm's marginal cost is $2 and its residual marginal revenue is $3, which of the following statements is true?

• A)It should increase production to maximize profit.
• B)It should decrease production to maximize profit.
• C)It should cut production in half to maximize profit.
• D)It is maximizing profit.

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Definitions:

Bird

A warm-blooded, vertebrate animal characterized by feathers, beaks, and typically the ability to fly.

Bird-Like

Describing characteristics or features that resemble those of birds, such as having feathers, beaks, or the ability to fly.

Case

An instance or occurrence of a particular type or category, often used to study or analyze specific characteristics or outcomes.

Actor

An individual who performs in theatrical productions, films, or television shows, portraying characters.