Negative profit 

• FC + VC > R(q)
• MR > MC

   Indicates higher profit at the higher output

- Question: Why is profit negative when the output is zero?

- Output levels: q₀ -  q*

• R(q)> C(q)
• MR > MC

  Indicates higher profit at the higher output while Profit is increasing

- Output level: q*

• R(q)= C(q)
• MR = MC
• Profit is maximized
• Question

-Why is profit reduced while producing more or less than q*? 

- Output levels beyond q*

• R(q)> C(q)
• MC > MR
• Profit is decreasing

* Thus, it can be said:

- Profits can be maximized when MC = MR.


  : when maximized   are   Profits