A Perfect Competitor's Output in the Short Run Is the Quantity

question 42

Multiple Choice

A perfect competitor's output in the short run is the quantity that:

• A)sets MC equal to MR = P.
• B)sets AVC = P.
• C)minimizes ATC.
• D)sets ATC = P.
• E)none of the above are correct.

---

Definitions:

Debt-To-Equity Ratio

A metric that shows the balance between the amount of a company's assets financed by owners' equity and that financed by debt.

Working Capital

Working capital represents a company's operating liquidity and is calculated as current assets minus current liabilities.

Long-Term Assets

Assets that a company plans to hold for more than one fiscal year, such as buildings, land, and equipment.

Current Ratio

A financial ratio indicating a firm's capacity to settle short-term liabilities using its short-term assets.