Consider a firm that operates in a perfectly competitive market. Currently the firm is producing 300 units of output and the price is $20 . If marginal cost at 300 units is $22, the firm
a. could increase profits by reducing output from 300 units.
b. could increase profits by increasing output from 300 units.
c. should decide to increase the price above $20

Any production point outside the production possibilities frontier is

A) unattainable. B) associated with unused resources. C) attainable only if prices fall. D) attainable only if prices rise.

The figure illustrates the demand for peanuts. If the price falls from $12 to $9 a bag, total revenue will ________, and if the price rises from $3 to $6 a bag, total revenue will ________

A) increase; decrease B) increase; increase C) decrease; increase D) decrease; decrease