If, for a perfectly competitive firm, price exceeds the marginal cost of production, the firm should
A) reduce its output.
B) increase its output.
C) lower the price.
D) keep output constant and enjoy the above normal profit.
B
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Which of the following characterizes the classical view of the economy?
a. The economy is inherently unstable. b. Prices and wages are not flexible. c. The economy will "self-adjust" to full employment. d. None of these.
Which of the following are not financial intermediaries?
a. banks b. mortgage companies c. finance companies d. check cashing companies
How does economic rivalry take place in monopolistic competition? Describe the different aspects of product differentiation and price competition
What will be an ideal response?
As long as two firms have different abatement costs, they:
A. can benefit under a system of marketable pollution permits by trading the right to pollute. B. will prefer a pollution tax to a system of marketable pollution permits. C. will decrease the price of their product if taxed on the amount of pollution they emit. D. will not be able to benefit from trading the right to pollute under a system of marketable pollution permits.