A Perfectly Competitive Firm Is Producing a Good at a Level

question 12

Multiple Choice

A perfectly competitive firm is producing a good at a level where P = $30 and MC = $30. The firm will continue to produce in the short run as long as

• A) AVC is less than $30.
• B) AFC is less than $30.
• C) price does not increase.
• D) ATC is greater than $30.

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Definitions:

Social Learning Theory

A theory that suggests people learn from their environment, through observation, imitation, and modeling of others' behaviors.

Reinforcement

In psychology, a process in which a behavior is strengthened or increased by a consequence that follows it.

Imitation

The action of using someone or something as a model and attempting to replicate their behavior or characteristics.

Modeling

The process of learning behavior by observing and imitating others.