MC ATC Q 30.00 28.00- a 26.00- 24.00- AVC G 22.00- The figure to the right represents the cost structure for a perfectly competitive firm with its average total cost (ATC) curve, average variable (AVC) curve, and marginal cost (MC) curve. Fixed costs are $50.00 Suppose the market price is $21.00 per unit. Characterize the firm's profit If the firm produces output, then it will Should the firm instead shut down in the short run? In the short run, the firm should OA. shut down because price is less than fixed costs OB. shut down because price is greater than average variable cost OC. shut down because price is less than average total cost. OD. continue to produce because price is greater than average variable cost O E. continue to produce because price is greater than average fixed cost. Price and cost 20.00- 18.00 16.00- 14.00- 12.00- 10.00- 8.00- 6.00 4.00- 2.00- 0.00+ Quantity
MC ATC Q 30.00 28.00- a 26.00- 24.00- AVC G 22.00- The figure to the right represents the cost structure for a perfectly competitive firm with its average total cost (ATC) curve, average variable (AVC) curve, and marginal cost (MC) curve. Fixed costs are $50.00 Suppose the market price is $21.00 per unit. Characterize the firm's profit If the firm produces output, then it will Should the firm instead shut down in the short run? In the short run, the firm should OA. shut down because price is less than fixed costs OB. shut down because price is greater than average variable cost OC. shut down because price is less than average total cost. OD. continue to produce because price is greater than average variable cost O E. continue to produce because price is greater than average fixed cost. Price and cost 20.00- 18.00 16.00- 14.00- 12.00- 10.00- 8.00- 6.00 4.00- 2.00- 0.00+ Quantity
Chapter7: Perefect Competition
Section: Chapter Questions
Problem 4SQ
Related questions
Question
Not use ai please
Transcribed Image Text:MC
ATC Q
30.00
28.00-
a
26.00-
24.00-
AVC G
22.00-
The figure to the right represents the cost structure for a perfectly competitive firm with its average total
cost (ATC) curve, average variable (AVC) curve, and marginal cost (MC) curve. Fixed costs are $50.00
Suppose the market price is $21.00 per unit.
Characterize the firm's profit
If the firm produces output, then it will
Should the firm instead shut down in the short run?
In the short run, the firm should
OA. shut down because price is less than fixed costs
OB. shut down because price is greater than average variable cost
OC. shut down because price is less than average total cost.
OD. continue to produce because price is greater than average variable cost
O E. continue to produce because price is greater than average fixed cost.
Price and cost
20.00-
18.00
16.00-
14.00-
12.00-
10.00-
8.00-
6.00
4.00-
2.00-
0.00+
Quantity
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Economics (MindTap Course List)
Economics
ISBN:
9781337617383
Author:
Roger A. Arnold
Publisher:
Cengage Learning
