The Price of a Firm's Product Is $8 and the Firm

question 127

Multiple Choice

The price of a firm's product is $8 and the firm faces a constant marginal cost of $5 that is equal to its (constant) average total cost. If the firm does not sell a unit of its product on the day it was produced, it is sold in a secondary market for a price of $2. If the firm does not sell a unit of its product on the day it was produced, there is a ________ of_______ per unit not sold.

• A)loss; $3
• B)loss; $2
• C)profit; $5
• D)profit; $3

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