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    Question

    The Firm maximises profit by producing that quantity of

    output where
    A Marginal Revenue = Marginal Cost Correct Answer Incorrect Answer
    B Total Revenue = Total Revenue Correct Answer Incorrect Answer
    C Average Revenue = Average Cost Correct Answer Incorrect Answer
    D Marginal Revenue = Average Cost Correct Answer Incorrect Answer

    Solution

    The general rule is that firm maximises profit by producing that quantity of output where marginal revenue equals marginal costs. The profit maximization issue can also be approached from the input side.

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