Suppose we have a firm in a perfectly competitive market. Assume that we have the usual shaped cost curves. At a market price of $15 the profit maximizing firm produces 53 units. Something changes that causes the firm to produce a quantity of zero at a price of $15 in the short-run. Which of the changes below can explain the change in the firm's behavior? O An increase in the fixed cost and a decrease in the marginal cost. O An increase in the fixed cost. O An increase in the marginal cost. O A decrease in the market price.

Suppose we have a firm in a perfectly competitive market. Assume that we have the usual shaped cost curves. At a market price of $15 the profit maximizing firm produces 53 units. Something changes that causes the firm to produce a quantity of zero at a price of $15 in the short-run. Which of the changes below can explain the change in the firm's behavior? O An increase in the fixed cost and a decrease in the marginal cost. O An increase in the fixed cost. O An increase in the marginal cost. O A decrease in the market 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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