9.3 Short-Run Decisions Assume the Following Total Cost Schedule for a Perfectly Competitive

question 123

Multiple Choice

9.3 Short-Run Decisions
Assume the following total cost schedule for a perfectly competitive firm.
TABLE 9-2
-Refer to Table 9-2.If the firm is producing at an output level of 6 units,the ATC is ________ and the AVC is ________.

• A)$55; $16.67
• B)$38.33; $16.67
• C)$80; $55
• D)$55; $80
• E)$71.67; $55

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Definitions:

Consumer Surplus

The gap between the maximum sum consumers are ready to pay for a product or service and the sum they ultimately spend.

Autarky

This is a situation where a country or region is self-sufficient and does not engage in international trade with other countries.

Employee Retirement Income Security Act

A federal law that sets minimum standards for most voluntarily established retirement and health plans in private industry to provide protection for individuals in these plans.

Vesting Rights

Are guaranteed rights to receive pension benefits.