In the Following Graph, MR and AR Represent the Marginal

question 76

Multiple Choice

In the following graph, MR and AR represent the marginal revenue and average revenue curves of a monopoly firm respectively. MC represents the marginal cost curve of the firm. Refer to the figure to answer the question. The profit-maximizing monopoly firm will produce output at the point where:

• A) marginal cost is decreasing.
• B) the marginal cost curve intersects the marginal revenue curve.
• C) the average revenue curve intersects the marginal cost curve.
• D) marginal cost is zero.

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Definitions:

COGS

Stands for Cost of Goods Sold and refers to the direct costs attributable to the production of the goods sold by a company.

Payables Turnover Rate

A liquidity metric that measures how quickly a company pays off its suppliers by dividing total purchases by average accounts payable.

Accounts Payable Balance

The amount of money a company owes to its suppliers or creditors for goods and services purchased on credit.

Sales

The exchange of goods or services for money, representing the primary revenue source for most businesses.