Equilibrium Price Is $17 in a Perfectly Competitive Market

question 119

Multiple Choice

Equilibrium price is $17 in a perfectly competitive market. For a perfectly competitive firm, MR = MC at 275 units of output. At 275 units, ATC is $19, and AVC is $13. The best policy for this firm is to __________ in the short run. Also, total fixed cost equals __________ for this firm.

• A)continue to produce; $3,575
• B)shut down; $699
• C)continue to produce; $1,650
• D)shut down; $2,796
• E)continue to produce; $6

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Definitions:

Per Stirpes

A distribution in which each surviving descendant divides the share that his or her parent would have taken if the parent had survived. Also called by right of representation.

Descendants

Individuals who are the direct blood relatives in the downward line, including children, grandchildren, and so on.

Surviving Descendant

A direct blood relative of a deceased individual, such as a child or grandchild, who is entitled to inherit under the laws of intestacy.

Holographic Wills

Handwritten wills made by the testator, generally without formal witnessing, that may be legally binding in some jurisdictions.