Consider the Total Cost and Revenue Curves Shown Below,for Two

question 80

Multiple Choice

Consider the total cost and revenue curves shown below,for two perfectly competitive firms,Firm A and Firm B. FIGURE 9-4
-Refer to Figure 9-4.Given its total cost and revenue curves,Firm A should

• A)build another plant to reap scale economies.
• B)produce zero output.
• C)continue production,as it is earning positive profits.
• D)maximize its profits by producing that level of output such that the slope of the TC curve is equal to the slope of the TR curve.
• E)maximize its profits by producing that level of output such that the slope of the TVC curve is equal to the slope of the TR curve.

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