The Ajax Manufacturing Company is selling in a purely competitive market. Its output is 100 units, which sell at $4 each. At this level of output total cost is $600, total fixed cost is $100, and marginal cost is $4. The firm should:
A. reduce output to about 80 units.
B. expand its production.
C. continue to produce 100 units.
D. produce zero units of output.
Answer: D
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