According to the marginal approach to profit maximization,
A)firms should equate total revenue and marginal cost when choosing the optimal output level
B)firms should take any action that increases revenue more than costs
C)economic profit is zero in the long run
D)marginal cost declines until it reaches marginal revenue at the profit-maximizing output level
E)marginal costs eventually diminish as more output is produced

Question

Quizplus · Accepted Answer

Firms should take any action that increases revenue more than costs, as this will increase profit. This aligns with the marginal approach to profit maximization, where firms equate marginal revenue and marginal cost to determine the optimal output level.

According to the Marginal Approach to Profit Maximization