An oligopolist charges a lower price than the short-run profit-maximizing price. How does this affect the firm’s productive efficiency?
a. The firm fails at productive efficiency because P 1 exceeds the minimum ATC.
b. The firm fails at productive efficiency because P 1 is less than the minimum ATC.
c. The firm achieves productive efficiency because P 1 exceeds MC.
d. The firm achieves productive efficiency because P 1 is less than MC.
a. The firm fails at productive efficiency because P 1 exceeds the minimum ATC.
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The transactions demand for money is the demand to hold money to
A) make regular, expected purchases. B) purchase bonds when interest rates increase. C) store one's wealth. D) meet unplanned expenditures.
M2 equals
A) M1 and is just another name for currency outside of banks. B) M1 plus savings deposits and small time deposits minus money market fund deposits. C) M1 plus savings deposits, small time deposits, and money market fund deposits. D) M1 minus traveler's checks because they are not really money. E) currency plus savings deposits, all time deposits, and money market funds and other deposits.