A producer's minimum acceptable price for a particular unit of a good
A) is the same for all units of the good.
B) will, for most units produced, equal the maximum that consumers are willing to pay for the good.
C) equals the marginal cost of producing that particular unit.
D) must cover the wages, rent, and interest payments necessary to produce the good but need not include proﬁt.

Question

Quizplus · Accepted Answer

A producer's minimum acceptable price for a particular unit of a good is determined by the marginal cost of producing that unit. It represents the cost of producing one more unit of the good, including materials, labor, and overhead costs. The producer will not sell the unit for less than the marginal cost, as doing so would result in a loss. Therefore, option C is the correct answer. Options A and B are incorrect, as the minimum acceptable price varies for each unit of the good and may not always equal the maximum that consumers are willing to pay. Option D is also incorrect, as the minimum acceptable price must cover all costs of production, including profit.

A Producer's Minimum Acceptable Price for a Particular Unit of a Good