A Firm That Exits Its Market Has to Pay

question 200

Multiple Choice

A firm that exits its market has to pay

• A)its variable costs but not its fixed costs.
• B)its fixed costs but not its variable costs.
• C)both its variable costs and its fixed costs.
• D)neither its variable costs nor its fixed costs.

---

Definitions:

Commons Dilemma

Social dilemma in which cooperation by all benefits all, but competition by all harms all.

Ethnocentric Actions

Behaviors driven by the belief that one's own cultural group is superior to others.

Social Facilitation

An improvement in the performance of well-learnt/easy tasks and a deterioration in the performance of poorly learnt/difficult tasks in the mere presence of members of the same species.

Free-rider Effect

A phenomenon where individuals benefit from resources or services without contributing to the cost, common in public goods scenarios.