Find optimal production level for maximum profit
Profit Maximization Rule: Produce where Marginal Revenue (MR) equals Marginal Cost (MC).
Perfect Competition: MR = Price (constant), so produce where MC = Price.
Economic Profit: Total Revenue minus Total Cost, including opportunity costs.
Break-Even Point: Where Total Revenue equals Total Cost (zero economic profit).
Shutdown Point: Where price falls below average variable cost - firm should cease production.