Which of the Following Is (Are)true

question 57

Multiple Choice

Which of the following is (are) true?

• A)In perfect competition, price will be less than marginal cost.
• B)In perfect competition, price will seldom adjust to reflect changes in production costs in the long run.
• C)In perfect competition, to maximize profits, a firm will operate where P = MR = MC.
• D)All of the above are true.

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Definitions:

Reporting Entities

Organizations or entities that are required to prepare financial statements to provide information to external users such as investors, creditors, and regulatory agencies.

Control

The power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee without having control or joint control over those policies.

Presumptive Test

A preliminary test based on presumptions established by criteria or evidence that suggests or implies a certain condition or outcome.