To Maximize Its Profit,in the Short Run a Perfectly Competitive

question 154

Multiple Choice

To maximize its profit,in the short run a perfectly competitive firm decides

• A) what price to charge for its product.
• B) what quantity of output to produce.
• C) whether to exit the market.
• D) whether to increase the size of its plant.
• E) how much advertising it should undertake.

---

Definitions:

Flow of Dollars

The movement of money through an economy, tracking how dollars are transferred from one sector to another.

Circular-Flow Diagram

A Circular-Flow Diagram is a visual model of the economy that shows how dollars flow through markets among households and firms.

Revenue

The total amount of income generated by the sale of goods or services related to a company's primary operations.

Factors of Production

The factors of production include land, labor, capital, and entrepreneurship, which are the resources used in the process of producing goods and services.