A Competitive Firm Is Choosing an Output Level to Maximize

question 4

Multiple Choice

A competitive firm is choosing an output level to maximize its profits in the short run.Which of the following is not necessarily true? (Assume that marginal cost is not constant and is well defined at all levels of output.)

• A)Marginal cost is at least as large as average variable cost.
• B)Total revenues are at least as large as total costs.
• C)Price is at least as large as average variable cost.
• D)Price equals marginal cost.
• E)The marginal cost curve is rising.

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Definitions:

Separately Excited

Describes an electrical circuit or device (typically in motors or generators) where the primary and the excitation circuits are electrically isolated from each other.

Compound

A substance formed from two or more elements chemically united in fixed proportions, often exhibiting properties different from those of the individual elements.

Electric Energy

Electric energy is the form of energy generated by the movement of electrons through conductors, and it can be used for a variety of applications including lighting, heating, and powering motors.

Commutator Segments

Sections of a commutator, which is a device used in electric motors and generators to reverse the direction of current.