If Marginal Revenue Exceeds Marginal Cost at the Current Level

question 470

Multiple Choice

If marginal revenue exceeds marginal cost at the current level of output, profit will increase when output is expanded because

• A) other firms in the industry will shut down as the firm expands output.
• B) the market price will rise as the firm expands output.
• C) producing and selling an additional unit will add more to total revenue than it adds to total cost.
• D) marginal cost will decline as output is expanded.

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Definitions:

Dead Consumers

Organisms that have consumed other organisms during their lifetime and have since died, playing a role in nutrient cycling as they decompose.

Environment

The sum of all external conditions and influences affecting the life and development of organisms.

Sun Energy

The radiant energy emitted by the Sun, which is harnessed by plants for photosynthesis and influences Earth's climate and weather.

Decomposers

Organisms that break down dead or decaying organisms, contributing to nutrient recycling in ecosystems.