If a Firm Is Maximising Its Profit and Producing Less

question 6

Multiple Choice

If a firm is maximising its profit and producing less than the output at which its average total cost is minimised, then that firm

• A) must be earning an economic profit.
• B) has excess capacity.
• C) must be earning a normal profit.
• D) must be suffering an economic loss.
• E) is producing at its capacity output.

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