Firms in perfectly competitive markets who wish to maximize profits ought to produce:
A. where total profit is the greatest.
B. at capacity and plan to expand in the long run.
C. where marginal revenue equals market price.
D. as many units as their scale allows.
Answer: A
You might also like to view...
When researchers use the damage function method, they
a. model the relationship between the cost of the policy and the associated reduction in environmental damages b. can directly measure the reduction in environmental damage in monetary units c. measure the link between a policy-induced decrease in contamination and the associated reduction in environmental damage d. can measure all aspects of incremental benefits at once
Consider the PPF for office buildings and housing shown in the figure above. Which point in the diagram shows that resources to produce office buildings and housing are being misallocated, unused, or both?
A) point F B) point G C) point H D) point I
Refer to the graph below. 
Suppose that the opportunity cost of producing 10 chickens is always 8 turkeys. Given this, the relevant production possibility curve must be:
A. I. B. II. C. III. D. IV.
Which of the following is NOT an economic function of government?
A) providing a legal system B) ensuring economic stability C) providing government-inhibited goods D) promoting competition