Suppose Product Price Is $24; MR = MC at Q

question 246

Multiple Choice

Suppose product price is $24; MR = MC at Q = 200; AFC = $6; AVC = $16. What do you advise this competitive price-taker firm to do?

• A) Increase output.
• B) Decrease output.
• C) Shut down operations.
• D) Stay at the current output; the firm is earning a profit of $400.
• E) Stay at the current output even though the firm is losing $200.

---

Definitions:

Always Existed

A concept referring to something that has had no beginning, and has been in existence for an infinite amount of time.

Baruch Spinoza

A Dutch philosopher of Portuguese Sephardi origin, known for his work in ethics, epistemology, and metaphysics, emphasizing monism – the idea that there is only one substance in the universe.

Pantheism

The belief that God is identical with creation. Baruch Spinoza, for example, was a pantheist. Hinduism, in some interpretations, can be construed as a form of pantheism.

Polytheism

Belief in many gods and goddesses.