If, for the last bushel of apples produced and sold by an apple farm, marginal revenue exceeds marginal cost, then in producing that bushel, the farm
A)added more to total cost than it added to total revenue.
B)added an equal amount to both total revenue and total cost.
C)added more to total revenue than it added to total cost.
D)maximized its profits or minimized its losses.

Question

Quizplus · Accepted Answer

If the marginal revenue exceeds the marginal cost, it means that the farm is earning more revenue than the additional cost incurred in producing that last bushel of apples. Therefore, the farm added more to total revenue than it added to total cost, making choice C the correct answer. This also indicates that the farm is making a profit on the last bushel of apples and is therefore maximizing its profits.

If, for the Last Bushel of Apples Produced and Sold