A Profit-Maximizing Perfect Competitor Will ___________ Operate at That Output

question 123

Multiple Choice

A profit-maximizing perfect competitor will ___________ operate at that output at which MC = MR.

• A)always
• B)usually
• C)sometimes
• D)rarely
• E)never

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Definitions:

Average Variable Cost

Average variable cost is the total variable cost divided by the quantity of output produced, showing the cost of producing each unit excluding fixed costs.

Short-Run Marginal Cost

The cost incurred by producing one additional unit of a product in the short term where at least one input is fixed.

Renting

The act of paying for the use of something, typically property, land, or a vehicle, owned by another person or company, over a specific period.

Additional Cost

Expenses that are not previously planned or accounted for, often arising unexpectedly in the course of an action or project.