Suppose a firm produces the level of output at which the marginal cost of the last unit produced equals the price of the good. Which of the following statements is always true?
A. The firm should shutdown if its total revenue is less than its variable cost.
B. The firm will earn a positive economic profit.
C. The firm should produce more if its economic profit is positive.
D. The firm is maximizing its profit.
Answer: A
You might also like to view...
If the market price is $40 in a perfectly competitive market, the marginal revenue from selling the fifth unit is
A) $8. B) $20. C) $40. D) $200.
If autonomous consumption is equal to $80, then when income is zero, saving is
a. $0 b. –$20 c. –$80 d. $20 e. $80
Refer to the diagram below of the market for corn. There will be a surplus of 8 thousand bushels at the price of:
A. $4/bushel
B. $3/bushel
C. $2/bushel
D. $5/bushel
Refer to the information provided in Figure 6.9 below to answer the question(s) that follow.
Figure 6.9Refer to Figure 6.9. The ________ video game rental has a marginal utility of zero.
A. first B. second C. third D. fourth