The Figure Given Below Shows the Revenue and Cost Curves

question 71

Multiple Choice

The figure given below shows the revenue and cost curves of a perfectly competitive firm.Figure 10.1

-Suppose that in a perfectly competitive market, the market supply of a good increases. As a result, the individual firm's:

• A)supply curve would shift outward and the firm would increase output.
• B)supply curve would shift inward and the firm would decrease output.
• C)average-total-cost curve would shift upward and the firm would increase output.
• D)marginal-revenue curve would shift upward and the firm would increase output.
• E)marginal-revenue curve would shift downward and the firm would decrease output.

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Definitions:

Monopolist

An individual or company that holds exclusive control over the supply or trade of a particular good or service, allowing them to influence prices and market conditions.

Short-Run

The short-run in economics refers to a period during which at least one input, such as plant size, is fixed and cannot be changed.

Long-Run

A period of time in which all factors of production and costs are variable, allowing for full adjustment to changes.

Marginal Revenue

The increase in revenue from the sale of one more unit of a product or service.