Table 83 Arnie Sells Basketballs in a Perfectly Competitive Market

question 97

Multiple Choice

Table 8.3 Arnie sells basketballs in a perfectly competitive market.Table 8.3 summarises Arnie's output per day (Q) , total cost (TC) , average total cost (ATC) and marginal cost (MC) .
-Refer to Table 8.3.What will Arnie's output be and how much profit will he earn if the market price of basketballs is $5.00?

• A)Q = 1; profit = -$10.
• B)Q = 3; profit = -$7.50
• C)Q = 0; profit = -$10.00
• D)Price and profit cannot be determined from the information given.

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Definitions:

Generally Accepted Accounting Principles

The standard framework of guidelines for financial accounting used in any given jurisdiction; commonly abbreviated as GAAP.

Financial Statements

Formal records that outline the financial activities and conditions of a business, including the balance sheet, income statement, and cash flow statement.

Accuracy in Accounting

The principle that ensures financial records and statements are free from errors or discrepancies and faithfully represent the financial performance and position of an entity.

Operating Activities

Business activities directly related to the production, sales, and delivery of a company's products and services, reflected in its cash flow.