If a Perfectly Competitive Firm Is Producing at the Output

question 95

Multiple Choice

If a perfectly competitive firm is producing at the output level where marginal revenue is equal to marginal cost and at this output level, the market price is less than the firm's average total cost, the firm is _______.

• A)not producing at the profit-maximizing output level
• B)earning a competitive return
• C)earning economic profits
• D)incurring an economic loss

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Definitions:

Behaviourism

A theory in psychology which states that all behaviors are learned through interaction with the environment, emphasizing the importance of observable actions over internal mental states.

Behaviourist

A psychologist who studies and applies theories based on the belief that all behaviors are acquired through conditioning.

Psychoanalytic

Pertaining to a theory of psychology and method of psychotherapy, originally developed by Sigmund Freud, that emphasizes the role of unconscious factors in determining behavior.

Humanist

Humanism is a philosophical stance emphasizing the value and agency of human beings, individually and collectively, often focusing on the pursuit of personal development and human well-being.