If a Firm Is Currently Equating MR and MC and Product

question 63

Multiple Choice

If a firm is currently equating MR and MC and product price = $24, AVC = $22, and ATC = $26, then in the long run this firm:

• A) will continue to operate at a loss.
• B) will earn a positive profit.
• C) will go out of business.
• D) should increase output.
• E) should decrease price.

---

Definitions:

Theoretical Distribution

A mathematical function that represents the possible values and their associated probabilities of a random variable.

Sampling Distribution

A specific statistic's probability distribution, resulting from a sample taken at random.

Variability

The degree to which scores in a set of data are spread out or differ from each other, indicating the diversity or dispersion within the dataset.

Sampling Distribution

The probability distribution of a given statistic based on a random sample, used to infer properties of an entire population.