Figure 9-15 depicts the cost curves for a perfectly competitive firm. This firm’s short run supply curve is the section of the MC curve between points

The usefulness of the price-taker model requires that the firm's decision makers

a. act to maximize their total revenue and fully understand marginal costs and marginal revenues. b. be able to draw accurate marginal cost and marginal revenue curves. c. place the social interest of the economy above their individual self interests. d. seek to maximize the profits of the firm.

If an amusement park that is highly profitable during the summer months is unable to cover its variable costs during the winter months, it should

a. raise its prices during the winter months. b. lower its prices during the summer months. c. operate during the summer but shut down during the winter months. d. operate during all months of the year as long as its profits during the summer exceed its losses during the winter.