For the Competitive Price Searcher

question 167

Multiple Choice

For the competitive price searcher,

• A) price will exceed marginal cost at the profit-maximizing level of output.
• B) price will equal average total cost in the long run.
• C) economic profit will be driven to zero in the long run by the entry and exit of firms.
• D) all of the above are correct.

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Definitions:

Cash Payments

Outflows of cash by an entity, typically for expenses, goods purchased, or services rendered.

Credit

A financial term describing the ability to borrow money or access goods or services with the understanding that payment will be made in the future.

Unearned Revenues

Unearned revenues refer to money received by a company for goods or services that have not yet been provided to the customer.

Liability

A financial obligation or debt owed by an individual or company to another entity, requiring the transfer of resources at a future date.