How does a review of marginal analysis assist in decisions made at a firm or economy?

1 Answer
Nallasivam V
Sep 17, 2015

By comparing Marginal Cost with Marginal Revenue.

Explanation:

A firm always compares the additional cost (MC) it incurs by producing one additional unit with additional revenue (MR) it gets for the sale of one additional unit. On the basis of this it takes a decision of how much it can produce.

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