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Explain Why Each of the Following Statements Is False

question 38

Essay

Explain why each of the following statements is false. What needs to be changed in each case to make the statement correct?
a. The competitive firm sets its price so that P = MC.
b. A firm will shut down when price is less than average cost.
c. Profits are profits, whether they are accounting or economic profits.
d. Costs are costs, whether they are implicit or explicit-they are still costs.
e. The supply curve for the firm in perfect competition is its marginal cost curve.


Definitions:

Abrasion

A wound caused by superficial damage to the skin, usually due to scraping or friction.

-ion

A suffix typically used in science denoting an action or process or a condition or state.

-er

A suffix in the English language used to denote someone who performs a particular action or a comparative adjective.

Ventricle

A hollow part or cavity in an organ, particularly one of the two main chambers of the heart or the brain.

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