Asked by Crystal Weaver on May 30, 2024
Verified
Marginal profit is equal to
A) marginal revenue minus marginal cost.
B) marginal revenue plus marginal cost.
C) marginal cost minus marginal revenue.
D) marginal revenue times marginal cost.
E) marginal revenue divided by marginal cost.
Marginal Profit
The additional profit earned from selling one more unit of a product or service.
Marginal Revenue
The incremental profit made from the sale of an additional unit of a good or service.
Marginal Cost
The increment in overall expenses due to the output of one more unit of a product or service.
- Learn the methods businesses employ to make decisions that maximize earnings.
Verified Answer
ZK
Zybrea KnightJun 03, 2024
Final Answer :
A
Explanation :
Marginal profit is the additional profit earned from the production and sale of one additional unit of a good or service. This is calculated by subtracting the marginal cost (the additional cost of producing one more unit) from the marginal revenue (the additional revenue earned from selling one more unit). Therefore, the correct formula for marginal profit is MR - MC, which corresponds to choice A.
Learning Objectives
- Learn the methods businesses employ to make decisions that maximize earnings.