For a Perfectly Competitive Firm, When MC Is Less Than

question 79

Multiple Choice

For a perfectly competitive firm, when MC is less than MR

• A) the producer has an incentive to expand output.
• B) the producer has an incentive to decrease output.
• C) the producer has no incentive to change production.
• D) economic profits must be positive.

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Definitions:

Semi-strong Form Efficiency

A theory in financial economics that implies all public information is already calculated into stock prices, meaning future price movements cannot be predicted using only public information.

Financial Markets

Financial markets are marketplaces where individuals and entities can trade securities, commodities, and other financial instruments in order to facilitate funding, investing, and risk management.

Advantage

The benefit or edge that a person, organization, or situation has over another.

Future Outlook

An estimate or forecast of a future situation or trend based on current data or trends.