9781118041581

Marginal Revenue and Marginal Cost 43

FIGURE 2.7

Total Profit

and Marginal Profit

The point of maximum

total profit in part (a)

corresponds to the

point at which

marginal profit is zero

in part (b). In each case,

the firm’s optimal

output is 3.3 lots.

150

100

50

0

–50

–100

01234 56

–150

100

50

0

–50

–100

01234 56

(a) Total Profit (Thousands of Dollars)

Profit

Marginal profit

Quantity (Lots)

(b) Marginal Profit

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