An Industry Analyst Observes That in Response to a Small

question 90

Multiple Choice

An industry analyst observes that in response to a small increase in price, a competitive firm's output sometimes rises a little and sometimes a lot. The best explanation for this finding is that:

• A) the firm's marginal cost curve is random.
• B) the firm's marginal cost curve has a very small positive slope.
• C) the firm's marginal cost has a very large positive slope.
• D) the firm's marginal cost curve is horizontal for some ranges of output and rises in steps.
• E) the firm's marginal cost curve is downward sloping.

---

Definitions:

Managed Care Organizations

Health care providers that offer a defined set of services to members for a fixed, prepaid fee, focusing on prevention and controlled costs.

Infant Mortality

The death of babies under one year of age, often used as an indicator of the health and well-being of a population.

Life Expectancy

This term refers to the average number of years a person is expected to live based on statistical averages, often influenced by factors like genetics, lifestyle, and healthcare access.

Economic Losses

Financial deficits suffered by individuals, organizations, or nations due to adverse events, investments, or disasters.