Figure12-1The Price-Taking Firm’s Profit-Maximizing Quantity of Output At the profit-maximizing quantity of output, the market price is equal to marginal cost. It is located at the point where the marginal cost curve crosses the marginal revenue curve, which is a horizontal line at the market price. Here, the profit-maximizing point is at an output of 5 bushels of tomatoes, the output quantity at point E.