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Suppose, at Its Current Output Level, a Firm's Marginal Profit

Question 10

Multiple Choice

Suppose, at its current output level, a firm's marginal profit is positive. Therefore, to maximize profit, it should:


A) decrease output until marginal profit is zero.
B) increase output because MR is less than MC.
C) increase both its output and its price.
D) increase output because MR is greater than MC.
E) increase output until it is producing at full capacity.

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