If a Perfectly Competitive Firm Produces at an Output Level

question 92

Multiple Choice

If a perfectly competitive firm produces at an output level where marginal cost equals marginal revenue,then

• A)the last unit produced adds the same amount to costs as it does to revenue.
• B)the firm is maximizing its revenue.
• C)there is no reason to reduce or expand output,as long as AVC is greater than or equal to price.
• D)the difference between TR and TC is zero.
• E)the firm should shut down.

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