In a Perfectly Competitive Market, If Price Is Greater Than

question 137

Multiple Choice

In a perfectly competitive market, if price is greater than average total cost at the level of output where marginal cost equals marginal revenue:

• A)the firm must be in long-run equilibrium.
• B)the firm is earning an economic profit greater than zero.
• C)the firm is earning an economic profit less than zero.
• D)we cannot determine whether the firm is earning positive or negative profits.

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Definitions:

Geometric Figure

A shape or form that consists of points, lines, curves, and surfaces following defined rules or equations in geometry.

Sexual Arousal

The physiological and psychological state of being awake or reactive to sexual stimuli.

Spontaneous Recovery

The reappearance of a conditioned response after a period of rest and with no further conditioning, often observed in behavioral psychology.

Extinction

The diminishing of a conditioned response; occurs in classical conditioning when an unconditioned stimulus (US) does not follow a conditioned stimulus (CS); occurs in operant conditioning when a response is no longer reinforced.