What action do you need to take if you have greater TR than your TC?1 puntoMaintain productionStop productionChange productProduce more

To determine the appropriate action to take when total revenue (TR) is greater than total cost (TC), it is important to analyze the implications of this relationship in a business context.

1. Understanding TR and TC: Total revenue (TR) represents the total income from sales, while total cost (TC) reflects the total expenses incurred in producing goods or services. If TR > TC, it indicates that the business is profitable since it is earning more than it is spending.

2. Assessing the Options:

   • Maintain production: This would make sense as the company is currently profitable. Continuing to produce can yield further profits.
   • Stop production: This would be illogical since stopping production would cut off revenue at a time when the business is already profitable.
   • Change product: While diversifying could potentially be beneficial, it may not be necessary if current products are already yielding profit.
   • Produce more: Since the business is already in a profit-making position, producing more could maximize profit, provided there is enough demand for the product.

3. Conclusion: Given that TR exceeds TC, the best course of action would be to either maintain current production levels or produce more to capitalize on the favorable financial situation.

Final Answer

The most logical action is to produce more to maximize profit.