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Agriculture Economics QUESTION #11882
Question 1
The optimal output combination for a profit-maximizing farmer occurs where:
  • The PPF is tangent to the isorevenue line✔️
  • Total revenue equals total cost
  • The isorevenue line crosses the vertical axis
  • Marginal cost equals zero
Correct Answer Explanation
The revenue-maximizing output mix occurs at the point where the PPF is tangent to the highest attainable isorevenue line.