Suppose Your Firm Is Operating in a Perfectly Competitive Market

question 20

Multiple Choice

Suppose your firm is operating in a perfectly competitive market, and that the minimum average variable cost of producing your good is $13. If the price of the good is $15, your firm should

• A) supply the amount of the good where the marginal cost of production is equal to $15.
• B) not produce anything since the price is above the minimum of average variable cost.
• C) not consider price when determining the amount to sell.
• D) not do any of the above.

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