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In the short run, profit maximising firm produces additional units of production, as long as :

According to the marginalist approach to short-run profit maximization, a firm continues to produce additional units of output as long as marginal revenue (additional…

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In the short run, profit maximising firm produces additional units of production, as long as :

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Correct answer D

According to the marginalist approach to short-run profit maximization, a firm continues to produce additional units of output as long as marginal revenue (additional revenue per unit) exceeds marginal cost (additional cost per unit). Equilibrium and maximum profit are achieved at the output level where marginal revenue equals marginal cost (MR = MC) and MC cuts MR from below.

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