In Long-Run Equilibrium, a Firm in a Perfectly Competitive Industry

question 64

Multiple Choice

In long-run equilibrium, a firm in a perfectly competitive industry will produce at the point where:

• A)marginal cost equals average total cost.
• B)total revenue is maximized.
• C)marginal cost equals average variable cost.
• D)its opportunity cost is lowest.
• E)price equals average fixed cost.

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Definitions:

Equally-Weighted Portfolio

An investment portfolio where each asset is allocated the same proportion of the total investment.

Securities

Assets indicating ownership in a company available on the stock market, indebtedness to either a corporate or government issuer, or entitlements to ownership through an option.

Two-Factor Economy

An economic model that considers two distinct factors or variables influencing outcomes, often used in finance to analyze returns or risks.

Expected Return

The average return an investor anticipates receiving on an investment if it is held for a specific period of time.