The largest loss a profit-maximizing perfectly competitive firm can incur in the short run equals its
A) average variable cost multiplied by output.
B) total fixed cost.
C) marginal cost multiplied by the number of units produced.
D) average total cost multiplied by the number of units produced.
E) total variable cost.
B
You might also like to view...
The following is an example of adverse selection
a. A majority of those applying for well paid jobs are under qualified b. More reckless drivers opt for cars with fewer safety devices c. Individuals living in less secure neighborhoods want to buy less insurance d. Individuals with a strong family history of heart diseases opt to buy less insurance
If an economic change lowers the production cost of a commodity but does not reduce its market price, economic value will be created
Indicate whether the statement is true or false
Because fiscal policy affects the quantity that the government borrows in financial capital markets, it not only affects aggregate demand, but it can also affect _____________ rates.
a. interest b. employment c. inflation d. wage
Which of the following is not true about a monopsonist?
A. It can set the wage rate and hire any desired number of workers at that wage. B. It is the only buyer of labor in a market. C. It usually extracts rents from its monopsony power. D. It determines the optimal employment-wage rate combination by equating the marginal revenue product of labor to the marginal cost of labor.