The Figure Given Below Shows the Revenue and Cost Curves

question 65

Multiple Choice

The figure given below shows the revenue and cost curves of a perfectly competitive firm.Figure 10.5
MC: Marginal cost curve
MR: Marginal revenue curve.ATC: Average-total-cost curve
AVC: Average-variable-cost curve
-For a perfectly competitive firm, in the short run, which of the following statements is true?

• A)A price above minimum average variable cost, but below average total cost will produce an economic profit.
• B)A price below minimum average variable cost will cause the firm to shut down.
• C)Marginal cost is parallel to the axis showing quantity of output.
• D)Price is always greater than marginal revenue.
• E)Every firm contributes a significant amount to the total market output.

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Definitions:

Supply Chain

The entire network of entities, directly or indirectly interlinked and interdependent in serving the same consumer or customer, involved in the delivery of a product or service from the supplier to the customer.

Communication

The process of exchanging information and ideas between individuals or groups using spoken words, written language, or other mediums.

Convenience

The quality of being suitable or suitable to one's needs or purposes with minimal effort or difficulty, often emphasized in product and service design.

Supply Chain

The entire network of entities involved in producing and delivering a product or service from the raw material to the end user.