Question

Profit maximization of a firm is achieved when:

• A. Total Revenue exceeds Total Costs
• B. Marginal Revenue equals Marginal Costs
• C. Average Revenue is Maximum
• D. Fixed Cost is Minimum

Hint:

In a perfectly competitive market, Price (\(P\)) is equal to Marginal Revenue (\(MR\)).
Therefore, the profit-maximizing condition for a competitive firm simplifies to \(P = MC\).

Answer 1

The Correct Option is B