If profits depend on both how much is produced (output) and on the level of advertising, then a profit-maximizing firm should choose the levels of output and advertising at which: a. the marginal revenue of output equals the marginal cost of output. b. the addition to total revenue of the last unit of advertising equals the addition to total cost of the last unit of advertising. c. total revenue equals total cost for both output and advertising d.both a and b e. both b and c

Economics:
10th Edition
ISBN:9781285859460
Author:BOYES, William
Publisher:BOYES, William
Chapter23: Profit Maximization
Section: Chapter Questions
Problem 11E
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If profits depend on both how much is produced (output) and on the level of advertising, then a profit-maximizing firm should choose the levels of output and advertising at which:

a. the marginal revenue of output equals the marginal cost of output.

b. the addition to total revenue of the last unit of advertising equals the addition to total cost

of the last unit of advertising.

c. total revenue equals total cost for both output and advertising

d.both a and b

e. both b and c

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