Final answer:
The profit-maximizing rule in economics states that a firm will maximize profit by producing the output for which marginal revenue equals marginal cost (MR=MC). The correct answer is equals.
Step-by-step explanation:
The profit-maximizing rule of MR=MC states that, in the short run, a firm will maximize profit or minimize loss by producing the output for which marginal revenue equals marginal cost. This economic principle is crucial for firms in making decisions about production levels. If the firm produces at a quantity where marginal costs exceed marginal revenue, it implies that each additional unit is costing more to produce than it generates in revenue, leading to a reduction in profit. Therefore, a firm will adjust its output to the point where the cost of producing an additional unit (marginal cost) is the same as the revenue that the unit brings in (marginal revenue), which is the point of profit maximization.
This rule applies to various market structures. In a perfectly competitive market, the marginal revenue received by a firm equals the price of the product (P), therefore the rule can also be expressed as producing up to the quantity where P = MC. For a monopoly, the firm increases or decreases output to ensure MR = MC, which is easily identifiable on a graph where the MR and MC curves intersect. Ultimately, whether producing at this level results in actual economic profits depends on the relationship between price and average total cost.