1094.53.5ATCAVC1 23 4 5 6 7 8 QuantityRefer to the above figure. If the price is $4, what will happen in the short-run?The firm will produce where marginal cost is at the minimum of the average total cost curve.The firm will exit the market.The firm will produce a positive amount of output.Average costs will fall.8795Price3MC

A perfectly competitive firm is a price taker, which means it takes the price set by the market…

Answered: 4.5 3.5 10 9 8 7 4 3 Price MC ATC AVC

Business

Economics

4.5 3.5 10 9 8 7 4 3 Price MC ATC AVC

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

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4.5
3.5
ATC
AVC
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3 4 5 6 7 8 Quantity
Refer to the above figure. If the price is $4, what will happen in the short-run?
The firm will produce where marginal cost is at the minimum of the average total cost curve.
The firm will exit the market.
The firm will produce a positive amount of output.
Average costs will fall.
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Price
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MC

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