For long-run equilibrium in perfect competition, the equilibrium output occurs at the lowest point on the ATC curve. Why does this happen?
a. Firms use the inputs that minimize the average total cost.
b. Firms use the inputs that maximize the average total cost.
c. Firms produce the output that minimizes the average total cost.
d. Firms produce the output that maximizes the average total cost.
c. Firms produce the output that minimizes the average total cost.
You might also like to view...
Purchasing power parity prices are used to construct GDP data that
A) do not omit the underground economy. B) can be used to make more valid comparisons between one country and another. C) is a proper measure of economic welfare. D) adjust for differences in population.
When is a firm more likely to engage in excessively risky behaviors, when business is well, or when it is facing financial distress?
What will be an ideal response?
In the European Monetary Union, the supply of euros
A) is managed by the individual central banks of the member countries. B) is managed by the European Central Bank. C) is determined by market forces. D) automatically varied in response to short-run fluctuations in the exchange rates of the member nations.
_____ prefer a quota to an import tax
a. Foreign producers b. Importers c. Consumers d. Foreign consumers