​Which of the Following Statements Is True

question 39

Multiple Choice

​Which of the following statements is true

• A)A firm should increase quantity as long as average cost is greater than price​
• B)A firm should increase quantity as long as price is greater than marginal cost
• C)A firm should increase quantity as long as price is higher than average cost,regardless of the marginal cost
• D)​A firm should increase quantity as long as marginal cost is greater than price

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Definitions:

Marginal Cost

The increase in total production costs that arises from producing an additional unit of a good or service.

Ideal

A concept or standard of perfection or excellence that serves as a benchmark or goal.

Price Takers

Entities in a market that accept prevailing prices for goods or services, lacking the market power to influence prices on their own.

Market

An abstract concept encompassing the forces of demand and supply and the interaction of buyers and sellers with the potential for exchange to occur.