Which of the Following Does Not Hold True for a Perfectly

question 244

Multiple Choice

Which of the following does not hold true for a perfectly competitive firm in long-run equilibrium?

• A) Its economic profit will be zero.
• B) It will minimise average total cost.
• C) It will charge a price equal to marginal cost.
• D) Marginal cost will be minimised.

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Definitions:

Cost of Goods Sold

Costs directly related to making the goods that a company markets.

Overapplied Overhead

Occurs when the allocated overhead costs exceed the actual overhead costs incurred.

Net Operating Income

Represents the profit earned from a company's core business operations, excluding expenses and revenues from non-operating activities.

Job-Order Costing

A cost accounting system that assigns manufacturing costs to an individual product or batch of products, typically used when the products being produced are sufficiently different from each other.