Assume a perfectly competitive firm is producing 300 units of output, P = $10, ATC of the 300th unit is $11, marginal cost of the 300th unit = $10, and AVC of the 300th unit = $9. Based on this information, the firm is:
A) earning an economic profit of $300.
B) earning an economic profit of $600.
C) incurring a loss of $300 and should shut down.
D) incurring a loss of $300, but should continue to operate in the short run.
D
Economics
You might also like to view...
If the consumption function is C = 90 + 0.75y, then the marginal propensity to save is
A) 0.25. B) 0.75. C) 67.5. D) 90.
Economics
If the price level falls, the aggregate supply decreases as a result of the aggregate demand curve shifting left.
Answer the following statement true (T) or false (F)
Economics