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The second order condition for profit maximization implies that A B C. economic profits must equal zero. marginal product must be increasing. marginal cost must equal marginal revenue. the expansion path must be linear. None of the above are correct answers.

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3 Feb 2018
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Related questions

Based solely on the first order condition of profit maximization A. profits may be maximized or minimized when MR=MC. total costs must be minimized when MR=MC. marginal profits must be maximized when MR-MC. All of the above would be TRUE.

From the profit maximization perspective, under which condition does it make sense to expand the level of output in the short-run?

A. when the marginal cost exceeds the marginal revenue

B. when the marginal cost is equal to the marginal revenue

C. when the marginal cost is less than the marginal revenue

D. none of the above as the marginal cost to marginal revenue comparison has nothing to do with profit maximization

In the short run, a firm operating in a monopolistically competitive market _____.

A. produces an output level where marginal revenue equals average total cost.

B. sets price equal to demand where marginal revenue equals marginal cost.

C. must earn zero economic profits.

D. maximizes revenues as well as profits.

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