A Picture Frame Company Operates in a Competitive Price-Searcher Market

question 182

Multiple Choice

A picture frame company operates in a competitive price-searcher market. Its short-run equilibrium price is $80 and its ATC is $65. It sells 100 picture frames a week. From this we can conclude

• A) this firm is making a normal profit.
• B) other picture frame companies will want to exit the market.
• C) there are no other picture frame companies in the area.
• D) economic profits are $1,500.
• E) total profits are being maximized.

---

Definitions:

Tibia

The medial bone of the lower leg; commonly called the shin bone.

Synovial Joints

Flexible connections between bones that are lubricated by synovial fluid, allowing for a wide range of movements.

Fibrous Joint Capsule

A component of a joint surrounded by connective tissue that encloses the ends of bones in a joint, providing stability and strength.

Synovial Joints

Joints that are enclosed in a capsule of connective tissue and contain a lubricating synovial fluid, allowing for smooth movement.