Consider the Following Short- Run Cost Curves for a Profit-

question 33

Multiple Choice

Consider the following short- run cost curves for a profit- maximizing firm in a perfectly competitive industry.
FIGURE 9- 2
-Refer to Figure 9- 2.If the market price is $2,the firm will

• A)shut down and make zero profit.
• B)produce 200 units and make a loss equal to its total fixed cost.
• C)produce 300 units and make a loss equal to total variable cost.
• D)continue operating in the short run and suffer a loss that is less than its fixed cost.
• E)shut down and suffer a loss equal to its fixed cost.

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Definitions:

Normal Routine

Typical daily activities or procedures followed by an individual or organization.

New Patterns Of Behavior

Refers to the emergent behaviors and habits of individuals or groups, especially as seen in consumer markets or societal changes.

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The practice of using an established brand name to introduce a new product in a different category.

Colgate's Kitchen Entrees

A real, albeit unsuccessful, product line extension by Colgate, traditionally known for toothpaste, into the food sector.