MC Ps SRATC PA SRAVC P3 P2 Pi вс DEF G H I A Quantity FIGURE 9-1 1) Refer to Figure 9-1. If the price a perfectly competitive firm is facing in the market is P2, then the profit-maximizing firm in the short run should produce output 1) A) В. В) С. C) D. D) E. E) F. 2) Suppose a perfectly competitive firm is producing where its average revenue is less than its lowest average variable cost. The firm should 2) A) shut down. B) increase the market price. C) reduce its output. D) expand its output. E) not change its output. Price $

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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1- Refer to Figure 9-1. If the price a perfectly competitive firm is facing in the market is P2, then the
profit-maximizing firm in the short run should produce output
A) B.         B) C.        C) D.        D) E.        E) F

 

2- Suppose a perfectly competitive firm is producing where its average revenue is less than its lowest
average variable cost. The firm should
A) shut down.
B) increase the market price.
C) reduce its output.
D) expand its output.
E) not change its output.

MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
MC
P5
SRATC
PA
SRAVC
P2
A
вс
DEF GH I
Quantity
FIGURE 9-1
1) Refer to Figure 9–1. If the price a perfectly competitive firm is facing in the market is P2, then the
profit-maximizing firm in the short run should produce output
1)
A) В.
B) С.
C) D.
D) E.
E) F.
2) Suppose a perfectily competitive firm is producing where its average revenue is less than its lowest
average variable cost. The firm should
2)
A) shut down.
B) increase the market price.
C) reduce its output.
D) expand its output.
E) not change its output.
Price $
Transcribed Image Text:MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. MC P5 SRATC PA SRAVC P2 A вс DEF GH I Quantity FIGURE 9-1 1) Refer to Figure 9–1. If the price a perfectly competitive firm is facing in the market is P2, then the profit-maximizing firm in the short run should produce output 1) A) В. B) С. C) D. D) E. E) F. 2) Suppose a perfectily competitive firm is producing where its average revenue is less than its lowest average variable cost. The firm should 2) A) shut down. B) increase the market price. C) reduce its output. D) expand its output. E) not change its output. Price $
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