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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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