When a Profit-Maximizing Firm's Fixed Costs Are Considered Sunk in the Short

question 379

Multiple Choice

When a profit-maximizing firm's fixed costs are considered sunk in the short run, then the firm

• A)can set price above marginal cost.
• B)must set price below average total cost.
• C)will never show losses.
• D)can safely ignore fixed costs when deciding how much output to produce.

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Definitions:

Environmental Changes

Alterations in the external surroundings that can impact ecosystems, human societies, and the global climate.

Temperament

The aspect of an individual's personality that is believed to be biologically based and relatively stable throughout life, influencing behaviors and ways of reacting to the environment.

Perceptual Information

Information processed by the brain that comes from one's senses, influencing perception of the environment.

Inhibited

A psychological or behavioral state where a person is restrained in their actions or reactions.