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Explanation :
e is the elasticity coefficient, or in other words, the ratio of percentage changes in two variables.
MR is marginal revenue, which refers to the extra income that a company receives from selling one additional unit of its product.
e = 1 is a special case in which the marginal revenue equals the elasticity of demand.
When the two are equal, marginal revenue is at its maximum value.
The equation for marginal revenue is MR = e / (e - 1). As you can see, if e = 1 then
MR = 1. If e = 1.001 then MR = .001.
If the marginal cost exceeds marginal revenue MC>MR), then producing more units will decrease profit (profit = TR-TC).
If the marginal cost exceeds marginal revenue (MC>MR), then producing more units will decrease profit (profit = TR-TC).
Final answer :
Hence the correct option is C .One.
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