To Maximize Its Profit,in the Short Run a Perfectly Competitive

question 154

Multiple Choice

To maximize its profit,in the short run a perfectly competitive firm decides

• A) what price to charge for its product.
• B) what quantity of output to produce.
• C) whether to exit the market.
• D) whether to increase the size of its plant.
• E) how much advertising it should undertake.

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Definitions:

Diseconomies of Scale

The phenomenon where production costs per unit increase as the scale of operation or output increases.

Output

In economics, the amount of goods or services produced by a business, industry, or economy.

Marginal Cost Curve

A graph that shows the cost of producing one more unit of a good or service at any given level of production.