If a Competitive Firm Cannot Earn Profit at Any Level

question 97

Multiple Choice

If a competitive firm cannot earn profit at any level of output during a given short-run period,then which of the following is LEAST likely to occur?

• A) It will shut down in the short run and wait until the price increases sufficiently.
• B) It will exit the industry in the long run.
• C) It will operate at a loss in the short run.
• D) It will minimize its loss by decreasing output so that price exceeds marginal cost.

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Definitions:

Hypnotic Suggestion

A directive given during hypnosis intended to influence thoughts, behaviors, sensations, or perceptions.

Encoding Failure

The inability to create a memory link for information, resulting in its forgetfulness.

Repression

In psychoanalytic theory, the basic defense mechanism that banishes from consciousness anxiety-arousing thoughts, feelings, and memories.

Memory Construction

The process whereby the brain forms, stores, and reconstructs information and experiences into memories.