B. Allows price adjustment but not quantity adjustment
C. Is all that is permitted by law
D. Is good for society
Explanation
A purely competitive firm will produce where Price (P) equals Marginal Cost (MC) because this action maximizes profits.
At this point, the firm achieves the highest level of profit by producing the quantity where the marginal cost of production equals the price it receives for its output.
This maximizes the difference between total revenue and total cost, which is the definition of profit maximization in economics.
کامل مقابلہ کے تحت زیادہ سے زیادہ منافع بخش فرم پیدا کرے گی؟
A. Never in the range where AP is diminishing
B. Only in the first stage of production
C. Always in the range where MP is diminishing
D. Never in the range where MP is diminishing
Explanation
A profit-maximizing firm under perfect competition will produce where marginal cost (MC) equals marginal revenue (MR), which occurs where marginal product (MP) is diminishing.
