In a Perfectly Competitive Market, If a Firm Finds It

question 223

Multiple Choice

In a perfectly competitive market, if a firm finds it is producing an amount of output such that its marginal cost exceeds its price, it will

• A) immediately shut down for the short run.
• B) be maximizing profits.
• C) increase its output to increase its profit.
• D) decrease its output to increase its profit.

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Definitions:

Persuasive Influence

The capacity to sway or change someone's beliefs, attitudes, or behaviors through argument, reasoning, or appeal.

Conformity

The adjustment of one's behavior or attitudes to match those of others or to fit into societal norms.

Dissenting Voice

An opinion or viewpoint that differs from the majority, often contributing to diversity of thought and innovation within a group.

Reference Group

A group with which an individual strongly identifies.