Karlos Sells His Product for $40 Each in a Competitive

question 11

Multiple Choice

Karlos sells his product for $40 each in a competitive price-taker market. At his present rate of output, his marginal cost is $39, average variable cost is $25, and average total cost is $45. To improve his profit/loss situation, Karlos should

• A) increase output
• B) reduce output but not to zero
• C) maintain the present rate of output
• D) shut down
• E) raise the price

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Definitions:

Non-Dedicated Wire

A wire within an electrical system that is not reserved for a single specific use or function.

Acid Tanker

A specialized tank truck designed for transporting acidic substances safely, featuring materials and construction that resist corrosion and damage from acids.

Stainless Steel

A corrosion-resistant alloy steel containing chromium, used in a wide variety of applications for its durability and appearance.

Non-Reactive

Describes substances that do not easily undergo chemical reactions with other substances under given conditions, often related to material safety and stability.