Consider the Total Cost and Revenue Curves Shown Below,for Two

question 80

Multiple Choice

Consider the total cost and revenue curves shown below,for two perfectly competitive firms,Firm A and Firm B. FIGURE 9-4
-Refer to Figure 9-4.Given its total cost and revenue curves,Firm A should

• A)build another plant to reap scale economies.
• B)produce zero output.
• C)continue production,as it is earning positive profits.
• D)maximize its profits by producing that level of output such that the slope of the TC curve is equal to the slope of the TR curve.
• E)maximize its profits by producing that level of output such that the slope of the TVC curve is equal to the slope of the TR curve.

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Definitions:

Legal Claim

A demand for rights or properties due to a dispute brought before a court.

Rightful Owner

The individual or entity that legally possesses property or rights, typically recognized through ownership documents or legal actions.

Temporary Possession

The condition of holding or controlling property or goods for a limited period without claiming ownership.

Chattel

Assets that can be physically relocated, unlike immovable real estate or land.