Profit Maximization Occurs When

question 51

Multiple Choice

Profit maximization occurs when:

• A) a firm expands output until marginal revenue is exceeded by marginal cost.
• B) a firm expands output until marginal revenue is equal to marginal cost.
• C) the price in the market is equal to the firm's marginal revenue.
• D) total costs equal total revenue.
• E) a firm sets the price at a point above average cost.

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Definitions:

Unconditioned Response

A natural, automatic reaction to a stimulus that occurs without any need for prior learning or conditioning.

Conditioned Response

is a learned reaction to a previously neutral stimulus that has become associated with an unconditioned stimulus through conditioning.

Pavlov

A Russian physiologist best known for his work in classical conditioning, particularly the concept of the conditioned reflex using dogs.

Unconditioned Stimulus

In classical conditioning, a stimulus that naturally triggers a reflexive or unlearned response.