When price is above marginal cost, selling one more unit at the current price will increase profit. This concept is known as the
A)income effect.
B)price effect.
C)output effect.
D)cartel effect.

Question

Quizplus · Accepted Answer

The output effect refers to the increase in profit when selling additional units at a price above marginal cost, as each additional unit sold adds more to revenue than to cost.

When Price Is Above Marginal Cost, Selling One More Unit