A Perfectly Competitive Firm Will Continue Producing in the Short

question 28

Multiple Choice

A perfectly competitive firm will continue producing in the short run as long as it can cover its _____ cost.

• A)total
• B)average fixed
• C)variable
• D)fixed

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Definitions:

Credit Balance

A credit balance is the amount of money a financial account shows on the credit side, indicating funds received or owed to the account holder.

Jobs Completed

Refers to work or projects that have been finished within a specified accounting period.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead costs to individual units of product based on a specific costing activity.

Direct Materials Cost

Direct materials cost refers to the expenditure associated with the raw materials used directly in manufacturing a product.