If a Perfectly Competitive Firm Is Faced with Average Revenue

question 23

Multiple Choice

If a perfectly competitive firm is faced with average revenue below average variable cost it will produce zero output so as to reduce its

• A)costs to below its revenue.
• B)costs to zero.
• C)losses to the amount of its fixed costs.
• D)losses to the amount of its variable costs.
• E)losses to the amount of its marginal costs.

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Definitions:

Obsessive-Compulsive Disorder

A mental disorder characterized by intrusive thoughts (obsessions) and repetitive behaviors (compulsions) driven by these thoughts.

Intrusive Thoughts

Unwanted and often distressing thoughts or images that spontaneously enter one's mind, causing discomfort or anxiety.

Suppress

To consciously or unconsciously hold back, inhibit, or stop an action, thought, or emotion from being expressed.

Phobia

An intense and irrational fear of specific situations, objects, or activities that results in a compelling desire to avoid the dreaded subject or situation.