At what point should a company produce in order to maximize its sales revenue?

Show Answers

When the additional cost of producing one more unit is zeroWhen the extra revenue from selling an additional unit is at its highestWhen the extra revenue from one more unit sold drops to zeroWhen the extra revenue gained from selling one more unit equals the extra cost of producing itWhen total revenue is at its peak

Explanation

The firm maximizes sales revenue by producing where marginal revenue equals marginal cost. Producing beyond this point means the cost of making an additional unit exceeds the revenue it generates, reducing overall profit.