The sufficient condition for a firm to be in equilibrium is that the
ECONOMICS
JAMB 2022
The sufficient condition for a firm to be in equilibrium is that the
- A. firm must show that it is profitable
- B. marginal cost must be equal to average revenue
- C. marginal revenue curve is above the average revenue curve
- D. marginal cost curve cuts the marginal revenue curve from below
Correct Answer: D. marginal cost curve cuts the marginal revenue curve from below
Explanation
A firm is said to be in equilibrium when it satifies the following conditions: - the first conditon for the equilibrium of the firm is that its profit should be maximum - Marginal cost should be equal to marginal revenue - Marginal cost must cut Marginal revenue from below
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