Which of the Following Is True for a Profit-Maximizing Competitive

question 215

Multiple Choice

Which of the following is true for a profit-maximizing competitive firm in the long run but not a monopolist?

• A)MC = MR.
• B)MC = P.
• C)AR = P.
• D)Q > 0.

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Definitions:

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service versus the total amount they actually pay.

Marginal Utility

The additional satisfaction or utility that a consumer derives from consuming one more unit of a good or service.

Marginal Utility

It describes the additional satisfaction or utility that a consumer receives from consuming one more unit of a good or service.

Total Utility

The overall satisfaction or benefit received by consuming a product or service.