Which of the following statements about marginal analysis is true?
A)An important factor in marginal analysis is predicting demand,which is an exact science.
B)Marginal analysis is typically a straightforward procedure to apply in real- life situations.
C)The cost of producing a unit beyond the point when marginal cost equals marginal revenue is much less than the revenue from the sale of that unit.
D)Marginal revenue is also the demand curve,so it represents the amount customers will buy at different prices.
E)Profit is maximized at the point at which marginal cost is exactly equal to marginal revenue.

Question

Quizplus · Accepted Answer

Profit is maximized when marginal cost equals marginal revenue because this is the point where the cost of producing an additional unit is exactly covered by the revenue it generates, ensuring no loss or unearned profit.

Which of the Following Statements About Marginal Analysis Is True