Question

"Farmer McDonald sells wheat to a broker in Kansas City, Missouri. Because the market for wheat is generally considered to be competitive, Mr. McDonald maximizes his profit by choosing__________.

Answer 1

Answer: Mr McDonald maximizes his profit by choosing the quantity at which market price is equal to Mcdonalds marginal cost of production.

Step-by-step explanation:

Marginal cost of production is defined as the change in total production cost that comes from producing an additional unit. This is calculated by dividing the change in production cost by change in quantity.

Therefore, when Mcdonalds marginal cost of production equals market price will maximize the firms profit.

Answer 2

Mr McDonald maximizes his profit by choosing the quantity at which market price is equal to Mcdonalds marginal cost of production.

Step-by-step explanation:

Marginal cost of production is defined as the change in total production cost that comes from producing an additional unit. This is calculated by dividing the change in production cost by change in quantity.

Therefore, when Mcdonalds marginal cost of production equals market price will maximize the firms profit.