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Suppose the utility function for a firm manager is U = π + bQ, where Q is output, π is profit, and b is a positive constant. How would the firm's output compare with what it would be if the manager's objective
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Suppose the utility function for a firm manager is U = π + bQ, where Q is output, π is profit, and b is a positive constant. How would the firm's output compare with what it would be if the manager's objective was to maximize profit?

User VorteXavier
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Answer:

It would be greater than the profit-maximizing output.

Step-by-step explanation:

ff the manager's objective was to maximize profit, the output would be greater than the profit-maximizing output where: the profit-maximizing happens when marginal revenue is equal to marginal cost.

User Goodtimeslim
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