If a Perfectly Competitive Firm in the Short Run Can

question 11

Multiple Choice

If a perfectly competitive firm in the short run can sell its output at $2.50 per bushel and it has an average variable cost of $1.75 per bushel and a marginal cost of $0.85 per bushel,it should

• A) expand output.
• B) raise its price.
• C) cut output to zero.
• D) advertise.
• E) do nothing at all; it is currently maximizing profits.

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Definitions:

Capillary Networks

A complex, interconnected web of capillaries that facilitates efficient exchange of oxygen, nutrients, and waste products between blood and tissues.

Laplace's Law

A principle that describes the relationship between the pressure, volume, and tension of spherical and cylindrical shapes, often applied in cardiovascular and respiratory physiology.

Pressure Differences

Variations in pressure between two areas, which can result in fluid or air movement from the higher pressure area to the lower pressure area.

Endothelium

The single layer of cells lining the blood and lymphatic vessels, heart, and other cavities in the body, instrumental in vascular function.