In the short run, if a perfectly competitive firm is unable to earn a profit, it will seek out the quantity of output where:
a. its costs of production are minimum
b. its losses are the smallest.
c. its price is greater than its marginal revenue.
d. its price is the lowest compared to its competitors.
b
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Why are income taxes on capital income more powerful than those on labor income?
What will be an ideal response?
Average cost curves decline because
a. fixed cost is spread out over larger amounts of production. b. it becomes cheaper to produce an infinite amount of goods. c. additional units of production are inferior. d. variable costs increase with each additional amount of production.
What does a market do poorly?
A. Incentivize individuals to efficiently use society’s resources B. Price labor based actually on marginal productivity C. Promote equal income distribution D. Allocate resources to their highest value uses
If a purely competitive firm is producing a level of output greater than its profit-maximizing output, then marginal revenue is greater than marginal cost.
Answer the following statement true (T) or false (F)