If the Marginal Cost for a Perfectly Competitive,profit-Maximizing Firm Currently

question 10

Multiple Choice

If the marginal cost for a perfectly competitive,profit-maximizing firm currently exceeds the price of its output,the firm should

• A) expand its output and lower its price.
• B) continue to produce at the same output rate and raise its price.
• C) contract output.
• D) increase its nonprice competition.
• E) do nothing; it is currently maximizing profits.

---

Definitions:

Pessimism

The tendency to see the worst aspect of things or believe that the worst will happen; a lack of hope or optimism.

Human Nature

A term referring to the characteristics, feelings, and behavioral traits of humankind that are naturally ingrained.

Congruence Corollary

A concept in psychology stating that personal growth is facilitated when there is alignment between an individual's self-image and experiences.

Fragmentation Corollary

A principle in psychology that suggests an individual's self-concept can become divided and inconsistent under stress.