Consider a Firm That Produces Peanut Butter

question 31

Multiple Choice

Consider a firm that produces peanut butter.An increase in the price of peanuts will cause the firm to lower its output because

• A) fixed costs will rise.
• B) marginal cost will rise.
• C) the price of peanut butter will rise.
• D) marginal revenue will fall.

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Definitions:

Larger Number

The value in a comparison of numbers that is greater than the other(s).

Smaller Number

In a comparison of two or more numbers, the one that is less in value.

Unit Price

The cost per single unit of measure, facilitating cost comparison among similar products.

Tissues Per Box

It indicates the number of individual tissue sheets contained within a single box.