Whenever a decrease in output leads to an increase in profit,the
A)marginal revenue curve lies above the marginal cost curve
B)total cost curve intersects the total revenue curve
C)marginal cost curve is parallel to the marginal revenue curve
D)marginal cost curve lies above the marginal revenue curve
E)total cost curve lies above the total revenue curve

Question

Quizplus · Accepted Answer

When a decrease in output leads to an increase in profit, the marginal cost curve lies above the marginal revenue curve, indicating that reducing output reduces costs more than it reduces revenue, thus increasing profit.

Whenever a Decrease in Output Leads to an Increase in Profit,the