This Graph Shows the Cost Curves for Moe's Mushroom Gathering

question 108

Multiple Choice

This graph shows the cost curves for Moe's mushroom gathering business, which is perfectly competitive. If mushrooms sell for $40 per bushel, and Moe chooses the profit-maximizing quantity, he will:

• A)earn zero profit.
• B)earn negative profit (a loss).
• C)earn positive profit.
• D)shut down.

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