If It Produces, a Perfectly Competitive Firm Will Maximize Profits

question 70

Essay

If it produces, a perfectly competitive firm will maximize profits when the:
A.marginal revenue equals marginal cost.
B.marginal revenue is lower than average variable cost.
C.price is lower than marginal cost.
D.price is higher than marginal cost.

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Definitions:

Sensory Adaptation

A process by which the sensitivity to a stimulus decreases over time when the stimulus is constantly present.

Gate-Control Theory

A theory that suggests the spinal cord contains a neurological "gate" that either blocks pain signals or allows them to continue on to the brain.

Perception

The process of organizing and interpreting sensory information, enabling us to recognize meaningful objects and events.

Basic Smells

A concept suggesting there are a limited number of primary smell sensations from which all other smells are derived, similar to primary colors.