If a Profit-Maximizing Firm in a Perfectly Competitive Market Is

question 164

Multiple Choice

If a profit-maximizing firm in a perfectly competitive market is currently producing the output where (price - average variable cost) > average fixed cost, the firm is

• A) making a positive economic profit.
• B) making a zero economic profit.
• C) suffering an economic loss.
• D) none of the above.

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Definitions:

Judgment

The cognitive process of assessing situations or information to form opinions or make decisions.

Sober Up

The process of becoming free from the effects of alcohol or drugs, regaining a clear state of mind and physical control.

Liver Function

The range of processes performed by the liver including detoxification, protein synthesis, and production of biochemicals necessary for digestion.

Cirrhosis

An irreversible condition, often caused by excessive drinking, in which the liver becomes scarred and begins to change in anatomy and functioning.