The competitive firm maximises profit when it produces output up to the point where:

Price equals average variable cost

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Marginal revenue equals average revenue

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Marginal cost equals total revenue

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Marginal cost equals marginal revenue

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Solution

The correct option is B Marginal cost equals marginal revenue
Any firm maximizes profits when it produce output up to the point where MC = MR and MC cuts to MR from below.

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Similar questions

Q. Draw a marginal revenue curve of a perfectly competitive firm and explain why the marginal revenue of a perfectly competitive firm is always equal to its average revenue.

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Can there be a positive level of output that a profit-maximising firm produces in a competitive market at which market price is not equal to marginal cost? Give an explanation.

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The competitive firm maximises profit when it produces output up to the point where:

The correct option is B Marginal cost equals marginal revenueAny firm maximizes profits when it produce output up to the point where MC = MR and MC cuts to MR from below.

The correct option is B Marginal cost equals marginal revenue
Any firm maximizes profits when it produce output up to the point where MC = MR and MC cuts to MR from below.