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B. At what output level is profit maximized?

C. At what output level is revenue maximized?

D. Discuss any differences in your answers to parts B and C.

P2.3 Marginal Analysis. Characterize each of the following statements as true or false, and explain your answer.

A. If marginal revenue is less than average revenue, the demand curve will be downward sloping.

B. Profits will be maximized when total revenue equals total cost.

C. Given a downward-sloping demand curve and positive marginal costs, profit-maximizing firms will always sell less output at higher prices than will revenue-maximizing firms.

D. Marginal cost must be falling for average cost to decline as output expands.

E. Marginal profit is the difference between marginal revenue and marginal cost and will always equal zero at the profit-maximizing activity level.

P2.4 Marginal Analysis: Tables. Sarah Berra is a regional sales representative for Dental Laboratories, Inc. Berra sells alloy products created from gold, silver, platinum, and other precious metals to several dental laboratories in Maine, New Hampshire, and Vermont. Berra's goal is to maximize her total monthly commission income, which is figured at 10% of gross sales. In reviewing her monthly experience over the past year, Berra found the following relations between days spent in each state and monthly sales generated:

Maine New Hampshire Vermont

Days

Gross Sales

Days

Gross Sales

Days

Gross Sales

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