At the Profit-Maximising Level of Output for a Perfectly Competitive

question 241

Multiple Choice

At the profit-maximising level of output for a perfectly competitive firm,

• A)price equals marginal cost.
• B)average revenue equals average variable cost, and price equals marginal cost.
• C)marginal revenue equals marginal cost, and average total cost equals average fixed cost.
• D)price equals average revenue, and marginal cost equals average variable cost.

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Definitions:

Semiskilled Labor

Workforce individuals possessing some training and skills but less than that required for skilled labor, often involving manual or repetitive tasks.

Backward-Bending

Refers to the portion of a labor supply curve that bends backward at higher wage levels, indicating a decrease in labor supply as wages increase beyond a certain point.

Substitution Effect

The change in consumption patterns due to a change in the relative prices of goods, leading consumers to substitute one good for another.

Income Effect

Shifts in economic or personal income and how these shifts influence the demand for certain goods or services.