Practice - Condition 1
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Practice Questions
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Define marginal revenue.
💡 Hint: Think about how much additional income comes from selling more.
What is the condition for profit maximization?
💡 Hint: What must be equal for maximum profit?
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Interactive Quizzes
Quick quizzes to reinforce your learning
What condition must hold for profit maximization in a perfectly competitive market?
💡 Hint: Think about what happens at different production levels.
True or False: A firm will increase production as long as MR is higher than MC.
💡 Hint: Consider the benefit versus the cost of producing more.
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Challenge Problems
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A firm has a total revenue of $800 when it sells 100 units. Calculate the marginal revenue when the firm decides to sell an additional 10 units, bringing total revenue to $860.
💡 Hint: Calculate the change in revenue over the change in quantity.
A company finds that for the last unit sold, marginal revenue is $12 and marginal cost is $15. What should the firm do next?
💡 Hint: Evaluate costs versus revenue and determine profit implications.
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