Table 74 Table 74 Shows the Short-Run Cost Data of a Perfectly Competitive

question 107

Multiple Choice

Table 7.4
$$\begin{array} { | c | c | c | c | } \hline \text { Quantity } & \begin{array} { c } \text { Average } \\\text { Fixed Cost }\end{array} & \begin{array} { c } \text { Average } \\\text { Variable Cost }\end{array} & \begin{array} { c } \text { Marginal } \\\text { Cost }\end{array} \\\hline 20 & \$ 40 & \$ 18 & \$ 18 \\\hline 40 & 20 & 14 & 10 \\\hline 60 & 13.1 & 16 & 20 \\\hline 80 & 10 & 22 & 40 \\\hline 100 & 8 & 30 & 62 \\\hline 120 & 6.61 & 40 & 90 \\\hline\end{array}$$ Table 7.4 shows the short-run cost data of a perfectly competitive firm. Assume that output can only be increased in batches of 20 units.
-Refer to Table 7.4.If the market price is $45,the firm

• A) will earn a profit of $3600.
• B) will suffer a loss of $200.
• C) will break even.
• D) will earn profit of $1040.

---

Definitions:

Needs-Hierarchy Theory

A psychological theory proposed by Abraham Maslow that categorizes human needs into five hierarchical levels, from basic physiological needs to self-actualization.

Gratified

Having given pleasure or satisfaction; in psychological terms, it often relates to the fulfillment of a desire or need.

Hereditary Component

The portion of an individual's traits or characteristics attributed to genetic inheritance from their biological parents.

Physiological Needs

Fundamental human requirements for sustaining life, including air, water, food, shelter, and sleep, critical for survival.