When a Firm's Demand Curve Is Tangent to Its Average

question 543

Multiple Choice

When a firm's demand curve is tangent to its average total cost curve, the

• A)firm's economic profit is zero.
• B)firm must be earning economic profits.
• C)firm must be incurring economic losses.
• D)firm must be operating at its efficient scale.

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Definitions:

Sensory Deprivation

A condition in which an individual receives little to no sensory input, often used therapeutically or in research to study the effects on the mind and body.

High Anxiety

A state of intense fear or apprehension that can affect one's ability to function in daily activities.

Homebound

A term describing individuals who are unable to leave their home due to physical or psychological conditions without considerable and taxing effort.

Auditory Nerve

The nerve that carries signals from the inner ear to the brain, enabling hearing.