Figure 7-2 -Refer to Figure 7-2.What happens if the firm produces more than Q₄ units? A) Its profit increases. B) It incurs a loss. C) Its total revenue is increasing faster than its total cost. D) It could make a profit or a loss depending on what happens to demand.

Question

Quizplus · Accepted Answer

Producing more than Q₄ units will exceed the point where marginal cost equals marginal revenue, resulting in a decrease in profit, or even a loss.

Figure 7-2 -Refer to Figure 7-2.What Happens If the Firm Produces More