The deep state entered Americaâs national discourse in 2017 with the feeling of an already familiar character, ready to assume a starring role as hero or villainâdepending on how you feel about Trump.
If a firm produces past that point, then marginal revenue is less than marginal cost. This means that the firm is losing profit with each additional unit of output and it should produce less. Remember that a competitive firm has a flat MR curve which is equal to the market price.
The marginal revenue (the increase in total revenue) is the price the firm gets on the additional unit sold, less the revenue lost by reducing the price on all other units that were sold prior to the decrease in price. A firms profits will be maximized when marginal revenue (MR) equals marginal cost (MC). If M R > M C {\displaystyle MR>MC} then a firm should increase output for more profits, if M R < M C {\displaystyle MR<MC} then a firm should decrease output for additional profits.