If a purely competitive firm is producing where price exceeds marginal cost, then:
A. the firm will fail to maximize profit, but resources will be efficiently allocated.
B. the firm will fail to maximize profit and resources will be overallocated to the product.
C. the firm will fail to maximize profit and resources will be underallocated to the product.
D. resources will be underallocated to the product, but the firm will maximize profit.
Answer: C. the firm will fail to maximize profit and resources will be underallocated to the product.
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One part of a perfectly competitive trout farm's supply curve is its
A) marginal cost curve below the shutdown point. B) entire marginal cost curve. C) marginal cost curve above the shutdown point. D) average variable cost curve above the shutdown point. E) marginal revenue curve above the demand curve.
By functioning as a unit of account, money provides a common measurement of the relative value of goods and services
a. True b. False Indicate whether the statement is true or false