-If the Price Is $12 Per Pizza, the Perfectly Competitive

question 169

Multiple Choice

-If the price is $12 per pizza, the perfectly competitive firm in the above figure is

• A) making an economic profit.
• B) making zero economic profit.
• C) incurring an economic loss.
• D) More information about the firm's total cost is needed to determine if the firm has a positive economic profit, zero economic profit, or an economic loss.

---

Definitions:

Producer Surplus

The difference between what producers are willing to accept for a product versus what they actually receive, usually seen as a measure of producer welfare.

Export Sector

The part of a country's economy that is involved in producing goods and services for sale in foreign markets.

Comparative Advantage

The ability of an individual or group to produce a good or service at a lower opportunity cost than others, leading to potential trade benefits.

Producer Surplus

The difference between what producers are willing to accept for a good or service and what they actually receive, due to the market price being higher.