A perfectly competitive firm will produce at an economic loss (negative profit) in the short run rather than discontinue production if there is a rate of output at which price
a. exceeds average variable cost
b. exceeds average fixed cost
c. exceeds average total cost
d. exceeds marginal revenue
e. equals marginal cost
A
Economics
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Explain how economic profits are reduced to zero as new firms enter a monopolistically competitive industry
Economics
Use the following graph for a perfectly competitive firm to answer the next question.
The lowest price at which the firm should produce (as opposed to shutting down) is
A. P1. B. P2. C. P3. D. P4.
Economics