If Price Is Greater Than Marginal Cost but Not Average

question 77

Multiple Choice

If price is greater than marginal cost but not average total cost,then:

• A) Total revenues are greater than total costs.
• B) The firm is earning a profit.
• C) Eventually the firm will go out of business.
• D) The firm is experiencing diminishing marginal utility.

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Definitions:

Autonomic Nervous System

The part of the nervous system that controls involuntary actions of the smooth muscles and heart and glands, regulating bodily functions such as heart rate and digestion.

Innervation

The supply of nerves to a specific body part, responsible for its sensory and motor functions.

Skeletal Muscles

Muscles attached to bones that are responsible for voluntary movements of the body.

Deceptive

Intentionally misleading or creating a false impression in order to achieve a specific purpose.