If the market price ever drops below a firm's average variable costs at its profit-maximizing level of output the:
A. loss-minimizing quantity of output is zero.
B. firm is not earning enough revenue to cover the variable costs of production.
C. firm should shut down immediately.
D. All of these are true.
Answer: D
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A Japanese television sells for ¥100,000 and a dollar is equal to ¥100. What is the dollar price of the television?
A) $1000 B) $99,900 C) $10,000,000 D) $100,100
For a tax to be successful, the tax base must be ¬¬¬_____
a. easy to measure and monitor b. large c. inelastic d. able to expand in times of crisis
Transfer earnings of a factor is equal to its:
a. economic rent. b. explicit cost. c. actual earnings. d. overhead cost. e. opportunity cost.
Which of the following will NOT be true if the antitrust laws are successful?
A) Producers will earn zero economic profits in the long-run. B) Firms will not restrict output. C) Firms will produce the competitive output. D) Firms will produce the quantity at which marginal cost equals marginal revenue and charge a price that is greater than marginal cost.