The Ajax Manufacturing Company Is Selling in a Purely Competitive

question 40

Multiple Choice

The Ajax Manufacturing Company is selling in a purely competitive market.Its output is 100 units, which sell at $4 each.At this level of output, total cost is $600, total fixed cost is $100, and marginal cost is $4.The firm should

• A)reduce output to about 80 units.
• B)expand its production.
• C)continue to produce 100 units.
• D)produce zero units of output.

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