Which of the Following Does Not Characterize a Perfectly Competitive

question 69

Multiple Choice

Which of the following does not characterize a perfectly competitive firm that has shut down in the short run?

• A)total revenue equals zero
• B)variable costs equal zero
• C)the firm suffers a loss
• D)fixed cost is positive
• E)fixed cost is zero

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Definitions:

Price Elasticity Of Demand

A measure in economics indicating how the quantity demanded of a good changes in response to a change in its price.

Marginal Cost

The increase in total cost that arises from an increase in the production of one additional unit of a good or service.

Profit-Maximizing Seller

A seller who adjusts prices and production levels to achieve the highest possible profit from their goods or services.

Short-Run Marginal Costs

The increase in total cost that arises from producing one additional unit of output when some inputs are considered fixed in the short term.