To maximize profits, firms produce the level of output that: O a. equates total revenue and total cost. O b. equates marginal revenue with marginal cost. O C. minimizes costs. O d. maximizes revenues.

To maximize profits, firms produce the level of output that: O a. equates total revenue and total cost. O b. equates marginal revenue with marginal cost. O C. minimizes costs. O d. maximizes revenues.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 5Q: What is meant by a products contribution margin ratio and how is this ratio useful in planning...

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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

To maximize profits, firms produce the level of output that:
O a. equates total revenue and total cost.
O b. equates marginal revenue with marginal cost.
O C. minimizes costs.
O d. maximizes revenues.

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