Within the framework of the price-taker model, a price taker will always produce a quantity of output that
A) minimizes the per-unit cost of production.
B) is expected to provide the largest possible total revenue.
C) maximizes total revenue minus total cost.
D) brings average total cost and price into equality.

Question

Quizplus · Accepted Answer

A price taker will produce the quantity of output where marginal cost equals marginal revenue, which is the point that maximizes total revenue minus total cost, or economic profit.

Within the Framework of the Price-Taker Model, a Price Taker