In Figure 24.2,the profit-maximizing level of output is
A)Between 2 and 3 units.
B)Between 4 and 5 units.
C)4 units.
D)Between 5 and 6 units.

Question

In Figure 24.2,the profit-maximizing level of output is
A)Between 2 and 3 units. 
B)Between 4 and 5 units. 
C)4 units. 
D)Between 5 and 6 units.

Quizplus · Accepted Answer

The profit-maximizing level of output is where marginal revenue equals marginal cost, which occurs at 4 units in the given figure (where the MR and MC curves intersect). Beyond this point, marginal cost exceeds marginal revenue, leading to a decrease in profit. Therefore, producing 4 units of output would result in the highest profit.

In Figure 24.2,the Profit-Maximizing Level of Output Is