If a firm sets marginal revenue equal to marginal cost, it will make an economic profit
Indicate whether the statement is true or false
False. When a firm sets MR=MC it maximizes profits but the profit-maximizing level of output might still be negative (the smallest loss possible).
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Last year, Casey grew fresh vegetables, which she sold at her local farmers market, but this year, Casey did not plant any vegetables and went to work at a bank instead. If Casey's decision to change careers did not affect the price of vegetables at the farmers market, then this suggests that:
A. the market demand for vegetables is perfectly inelastic. B. the demand for vegetables increased this year. C. the demand for vegetables did not change. D. the market for vegetables is perfectly competitive.
If a firm produces 8 units of output with average fixed cost=$40 and average variable cost=$25, what is its total variable cost?
a. $200 b. $320 c. $1,000 d. $650
For firms that sell one product in a perfectly competitive market, marginal revenue is:
A. equal to market price. B. the additional revenue gained from selling one more unit. C. equal to average revenue. D. All of these are true.
Dent 'n' Scratch Used Cars and Trucks employs 3 salesmen. Data for their sales last month are shown in this table: Cars SoldTrucks SoldLarry105Joe99Ralph312 Based on last month's data, Larry's opportunity cost of selling a truck is selling:
A. 2 cars. B. 1 car. C. 10 cars. D. 1/2 of a car.