Suppose a Perfectly Competitive Firm Faces the Following Situation: P

question 315

Multiple Choice

Suppose a perfectly competitive firm faces the following situation: P = $8; output = 2,000; ATC = $6.50; and MC = $8. Which statement is an accurate description of the firm's situation?

• A) The firm incurs a loss and is minimizing its loss.
• B) The firm earns profit but is not maximizing its profit.
• C) The firm is maximizing profit.
• D) The firm incurs a loss but is not minimizing its loss.

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