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.
A firm would not produce an additional unit of output with negative marginal revenue. And, assuming that the production of an additional unit has some cost, a firm would not produce the extra unit if it has zero marginal revenue.Because a monopoly firm will generally operate where marginal revenue is positive, we see once again that it will operate in the elastic range of its demand curve. To maximize profit or minimize losses, a monopoly firm produces the quantity at which marginal cost equals marginal revenue. 2  Its price is given by the point on the demand curve that corresponds to this quantity.