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A profit-maximizing monopolist will continue expanding output as long as:


a. marginal revenue exceeds marginal cost.
b. marginal revenue is positive.
c. the cost of producing an additional unit exceeds the marginal revenue derived from the unit.
d. economic profit is more than zero.

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Insha Fatima
Insha FatimaLv10
10 Oct 2020

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Related questions

1.Profit maximizing firms should increase output to the point where:

a.Total revenue is largest

b.Total revenue just exceeds total costs

c.An increase in revenue is just offset by an increase in cost.

d.Fixed costs are covered

e.Total cost is minimized

2.The Golden Rule of Output Determination for a perfectly competitive firm is to:

a.Choose the output rate at which price is greatest.

b.Choose the output rate at which marginal revenue equals marginal cost.

c.Produce to the point of diminishing marginal returns

d.Produce until total revenue exceeds total cost.

e.Choose the output rate at which total cost is the lowest.

3.Which of the following conditions would indicate that a perfectly competitive firm should expand output to increase its profit?

a.Marginal cost equals average cost

b.Total cost exceeds marginal cost

c.Price exceeds marginal cost

d.Total revenue exceeds total costs

e.Total revenue equal price

4. It would not pay a firm to produce anything in the short run if the price were:

a.Above average total costs

b.Equal to marginal cost and above the average variable cost.

c.Equal to total revenue divided by output

d.Below average variable cost

e.Below marginal average cost

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

16. If a profit-maximizing firm in perfect competition is earning economic profit, it must be producing at a level of output where A) price is greater than marginal cost. B) price is greater than marginal revenue. C) marginal cost is greater than marginal revenue. marginal cost is greater than average total cost. E) average total cost is greater than marginal cost.

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