In the Short Run, a Price Searcher Wishing to Maximize

question 59

Multiple Choice

In the short run, a price searcher wishing to maximize profits or minimize losses should produce the output that

• A) equates marginal cost with marginal revenue.
• B) equates marginal cost with price.
• C) corresponds to the lowest point on the average variable cost curve.
• D) corresponds to the lowest point on the average total cost curve.

---

Definitions:

Yield To Maturity

The total return anticipated on a bond if the bond is held until its maturity date, including all payments of interest and principal.

Semi-annually

Semi-annually refers to an event or action occurring twice a year, or every six months.

Coupon Rate

The interest rate stated on a bond when it's issued which indicates the percentage of the principal to be paid annually as interest.

Intrinsic Value

The actual, fundamental worth of an asset, calculated based on an objective analysis of underlying factors.