Suppose a Firm in a Competitive Market Reduces Its Output

question 352

Multiple Choice

Suppose a firm in a competitive market reduces its output by 20 percent. As a result, the price of its output is likely to

• A)increase.
• B)remain unchanged.
• C)decrease by less than 20 percent.
• D)decrease by more than 20 percent.

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Definitions:

Gift Card

A prepaid stored-value money card, issued by a retailer or bank, to be used as an alternative to cash for purchases within a particular store or related businesses.

Attendance

The act of being present at a place or event, often measured in contexts such as schools or workplaces.

Comfortable Room

A space designed and arranged to provide a sense of ease and relaxation.

Spouses

Legal partners in marriage, who may share responsibilities and privileges including financial, social, and emotional support.