A Competitive Price-Searcher Firm Is Currently Producing 10 Units of Output

question 204

Multiple Choice

A competitive price-searcher firm is currently producing 10 units of output. At this level of output the firm is charging a price equal to $10, has marginal revenue equal to $6, has marginal cost equal to $6, and has average total cost equal to $12. From this information we can conclude that

• A) the firm is currently earning zero profit.
• B) the profits of the firm are negative.
• C) firms are likely to enter this market in the long run.
• D) the firm would earn more profit by reducing output.

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Definitions:

Anterior Cingulate Cortex

A part of the brain located in the medial frontal cortex that plays a role in a wide variety of autonomic functions, decision making, empathy, impulse control, and emotion.

Obsessive-Compulsive Disorder

A mental disorder characterized by unwanted recurring thoughts (obsessions) and repetitive behaviors (compulsions) that an individual feels driven to perform.

Hyperactive

Characterized by more movement and activity than is typical or desirable, often to the point of being disruptive, as in certain attention disorders.

Disruptive Mood Dysregulation Disorder

Disruptive Mood Dysregulation Disorder is a mental health condition characterized by severe and recurrent temper outbursts that are disproportionate to the situation.