Consider the Following Cost Curves for Firm X,a Perfectly Competitive

question 54

Multiple Choice

Consider the following cost curves for Firm X,a perfectly competitive firm.
FIGURE 9- 5
-Refer to Figure 9- 5.If Firm X is producing output Q1 and the market price is P1,

• A) Firm X is at its long- run profit- maximizing position.
• B)new firms have a profit incentive to enter the industry,building larger plants.
• C)Firm X is producing at its minimum efficient scale.
• D)there is no lower- cost scale of plant which could be built by Firm X.
• E)there are profits to induce increases in output by Firm X,using its existing plant.