Suppose a Profit-Maximizing Firm in a Perfectly Competitive Market Is

question 146

Multiple Choice

Suppose a profit-maximizing firm in a perfectly competitive market is collecting $1,999 in total revenues. If the total cost of its fixed factors of production falls from $500 to $400, the firm will:

• A)expand its output.
• B)lower its price.
• C)earn greater profits or smaller losses.
• D)earn smaller profits or larger losses.

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Definitions:

Cognitive

Relating to cognition, involving the mental action or process of acquiring knowledge and understanding through thought, experience, and the senses.

Biological

Pertaining to the science of life or living matter in all its forms and phenomena, especially with reference to origin, growth, reproduction, structure, and behavior.

Learning Perspective

A psychological viewpoint that emphasizes the effects of experience on behavior, focusing on learning processes.

Cognitive Perspective

A psychological viewpoint that focuses on how people think, understand, and know about the world, emphasizing the importance of mental processes in understanding behavior.