AP®︎ Microeconomics: Topic 3.5 Flashcards

Master key terms and definitions for Topic 3.5 of AP Microeconomics – Profit Maximization to help you prep for quizzes and the AP exam.

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Term

Marginal Revenue and Marginal Cost Decision Rule

Definition

If MR > MC, increase output; if MR < MC, decrease output; if MR = MC, keep output unchanged.

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Marginal Revenue and Marginal Cost Decision Rule
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If MR > MC, increase output; if MR < MC, decrease output; if MR = MC, keep output unchanged.

CBA-2.DCBA-2.D.1
Profit-Maximizing Rule
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Produce the quantity where marginal cost equals marginal revenue and marginal cost is rising.

CBA-2.DCBA-2.D.1