In the Short Run, When the Prevailing Market Price Falls

question 7

Multiple Choice

In the short run, when the prevailing market price falls below the average variable cost curve, a firm in perfect competition will shut down because: ​

• A) ​economic profit is zero.
• B) ​price is less than marginal revenue.
• C) ​marginal revenue is insufficient to pay average variable cost.
• D) ​other firms will enter the market seeking profits.

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Definitions:

Neurons

Nerve cells.

Cortical Atrophy

The wasting away or decrease in size of the brain's cortex, often associated with aging or neurological diseases.

Dendrites

The branching projections of a neuron that act to conduct the electrochemical stimulation received from other neural cells to the cell body, or soma, of the neuron from which the dendrites project.

Reserve Capacity

The extra amount of functional capability that an organism or system can draw upon when needed.