If the marginal cost exceeds marginal revenue, the firm? A. is most likely to be at a...
Question:
If the marginal cost exceeds marginal revenue, the firm?
A. is most likely to be at a profit-maximizing level of output.
B. should increase the level of production to maximize its profit.
C. must be experiencing losses.
D. may still be earning a profit.
Marginal Cost:
Marginal cost is the cost that the firm experience after making the production of one more extra unit. The maximizing level of the production will be where marginal cost is equal to marginal revenue. The firm makes a loss when marginal cost is greater than marginal revenue.
Answer and Explanation: 1
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View this answer- The correct option is: C) must be experiencing losses.
If marginal cost is greater than marginal revenue, then the firm is earning a loss. The cost of...
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Marginal Cost: Definition, Equation & Formula
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Chapter 3 / Lesson 12
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What is marginal cost? Learn how to calculate marginal cost with the marginal cost formula. See the definition, behavior, and marginal cost examples.
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