A firm in a perfectly competitive market has an average total cost of $40 for the 100th good it sells. Its fixed costs are $100. The average total cost of the 101th good is $41. If the market price is $50 this firm should O sell only 100 goods because the marginal cost of the 101th exceeds marginal revenue. O sell 101 because price is greater than average total costs. sell 101 goods because it adds to profits. O sell 101 goods because its fixed costs are so low.

A firm in a perfectly competitive market has an average total cost of $40 for the 100th good it sells. Its fixed costs are $100. The average total cost of the 101th good is $41. If the market price is $50 this firm should O sell only 100 goods because the marginal cost of the 101th exceeds marginal revenue. O sell 101 because price is greater than average total costs. sell 101 goods because it adds to profits. O sell 101 goods because its fixed costs are so low.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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