If ATC = $20,AVC = $15,AFC = $5,MC = $15

question 22

Multiple Choice

If ATC = $20,AVC = $15,AFC = $5,MC = $15 and MR = $15,then a perfectly competitive firm should:

• A)decrease output because MR> AFC.
• B)increase output because ATC > MR.
• C)shut down if the price will be below $15.
• D)maximize its profit because MR = MC.

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Booming Economy

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