If a fiRm's Marginal Revenue Is Less Than Price at All

question 1

Multiple Choice

If a firm's marginal revenue is less than price at all levels of output, this means that _____.

• A) it must lower its price to sell an additional unit of output
• B) it is a price taker in the market
• C) there are no barriers to entry and exit in the market
• D) there are a large number of buyers and sellers in the market

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Definitions:

Algorithm

A step-by-step procedure or formula for solving a problem or completing a task, often used in computing and mathematics.

Subgoals

Smaller, achievable objectives set as steps toward reaching a larger goal, facilitating problem-solving and task completion.

Availability Heuristic

A mental shortcut that relies on immediate examples that come to mind when evaluating a specific topic, concept, method, or decision.

Representativeness Heuristic

The representativeness heuristic is a cognitive bias where people judge the probability of an event or the likelihood of an object belonging to a category by how much it resembles a typical case.