If a Perfectly Competitive Firm Is Producing Where Its MR=MC,but

question 122

Multiple Choice

If a perfectly competitive firm is producing where its MR=MC,but is operating to the left of the minimum point of its LRAC curve,

• A)it cannot be optimizing its short-run behaviour.
• B)it can reduce its average costs by building a larger plant.
• C)it can still be in long-run equilibrium as long as P = SRATC.
• D)its profits will decrease if it builds a larger plant.
• E)it is in a long-run profit maximizing position.

---

Definitions:

Whole Number Skills

The ability to understand, use, and manipulate whole numbers, encompassing skills such as addition, subtraction, multiplication, and division.

Reversibility

The ability to recognize that objects can change form or condition and return to their original form or condition.

Seriation

The cognitive ability to arrange objects in an order according to size, shape, or any other characteristic, which is a key aspect of logical thinking in children.

Long-Term Memory

The aspect of memory concerned with the storage of information over an extended period, potentially for a lifetime.