Which of the Following Is True at the Profit-Maximizing Quantity

question 118

Multiple Choice

Which of the following is true at the profit-maximizing quantity for both a perfectly competitive firm and a monopoly?

• A)Price equals marginal cost.
• B)Price is greater than marginal cost.
• C)Marginal revenue equals marginal cost.
• D)Marginal revenue is less than marginal cost.
• E)Marginal revenue is greater than average revenue.

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Definitions:

Market Economy

An economic system where prices and production are determined by unrestricted competition between privately owned businesses.

Market Economies

Economic systems in which decisions regarding investment, production, and distribution are guided by the price signals created by the forces of supply and demand.

Government Involvement

The participation or intervention of governmental bodies in certain areas of the economy, typically to correct market failures or to achieve certain social goals.

Government Regulation

Rules or laws established by governments aimed at controlling or guiding activities within various sectors of the economy, often to protect public interests.