If the Market Price Is $3 and a Perfectly Competitive

question 84

Multiple Choice

If the market price is $3 and a perfectly competitive firm is producing 1,200 units and the marginal cost to produce the 1,200th unit is $4.53, which of the following is true?

• A)The firm is maximizing profit.
• B)The firm should increase production to maximize profit.
• C)The difference between marginal revenue and marginal cost (MR - MC)for the 1,200th unit is negative.
• D)The difference between marginal revenue and marginal cost (MR - MC)for the 1,200th unit is positive.

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Definitions:

Atomic Sentences

Simple statements in logic that cannot be broken down further into smaller statements.

Truth Values

The valuation of statements as true or false in logic.

Truth Table

A table used in logic to determine whether a compound statement is true or false under all possible situations.

Atomic Sentences

A type of sentence that contains no logical connectors and represents the simplest form of statement that can be either true or false.