Question

Why is the equality between mc and mr necessary for a producer to be in equilibrium explain?

Answer 1

According to MC=MR approach, As long as MC is less than MR, it is profitable for the producer to go on producing more because it adds to its profits. He stops producing more only when MC becomes equal to MR. Market for a good is in equilibrium. The demand for the good 'increases'.

Answer 2

Answer:

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