A sale maximizing firm will produce where ?
Correct answer: D. sales revenue is maximized
- A. AR minus AC is maximized
- B. MC = MR
- C. quantity sold is maximized
- D. sales revenue is maximized
Explanation
A sales-revenue-maximising firm chooses the output at which total sales revenue is greatest, rather than where profit is greatest. Profit maximisation uses the condition MC = MR, so option b describes a different objective.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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