Assume the XYZ Corporation Is Producing 20 Units of Output

question 75

Multiple Choice

Assume the XYZ Corporation is producing 20 units of output. It is selling this output in a purely competitive market at $10 per unit. Its total fixed costs are $100 and its average variable cost is $3 at 20 units of output. This corporation

• A) should close down in the short run.
• B) is maximizing its profits.
• C) is realizing a loss of $60.
• D) is realizing an economic profit of $40.