To Maximise Profit, a Firm Will Produce the Level of Output

question 132

Essay

To maximise profit, a firm will produce the level of output where MR = MC.If a firm actually makes a profit depends on the relationship of price to average total cost.What are the three possible relationships between price and average total cost that determine if a firm will make a profit, experience a loss, or break even?
__________________________________________________________________________________________________________________________________________________________________________________________

---

Definitions:

Salivary Gland

Exocrine glands located in the mouth that produce saliva, aiding in digestion and oral hygiene.

Canine

A tooth located between the incisors and premolars, pointed in shape and used for tearing food.

Premolar

A type of tooth located between the canine teeth and molars in the mouth, used for crushing and grinding food.

Incisor

A front tooth specialized in cutting food, found in both the upper and lower jaws of mammals.