A Company Finds That at the Output Level at Which

Multiple Choice

A company finds that at the output level at which marginal cost equals marginal revenue, TC = $500, TVC = $400, and TR = $450. Your advice to the firm is

A) shut down, as TC > TR.
B) reduce output to reduce the cost of production.
C) increase output to reduce the per unit cost of production.
D) continue to produce because loss is less than TFC.