Refer to the table below
|Rate of Output||Fixed Costs||Variable Costs||Total Costs||Average Total Costs|
Compute total profits at a price of $35 per unit and an output of
a. 40 units
b. 50 units
Profit maximization is the belief that firms control output and price levels to achieve a point where they maximize revenues. Profit is equal to total revenues minus total costs. Profit maximization is equal to marginal revenue minus marginal cost. The profit maximization point is where any changes in output or prices decreases the firms profits.
Answer and Explanation:
See full answer below.
Become a member and unlock all Study Answers
Start today. Try it nowCreate an account
Ask a question
Our experts can answer your tough homework and study questions.Ask a question Ask a question
Learn more about this topic:
fromChapter 24 / Lesson 6
Learn the profit maximization definition, its importance, and explore the profit maximization theory. See how to calculate profit maximization with examples.