The Figure Given Below Shows the Revenue and Cost Curves

question 77

Multiple Choice

The figure given below shows the revenue and cost curves of a perfectly competitive firm.Figure 10.5
MC: Marginal cost curve
MR: Marginal revenue curve.ATC: Average-total-cost curve
AVC: Average-variable-cost curve
-If a profit-maximizing, perfectly competitive firm is producing at a loss in the short run, then it implies that:

• A)marginal revenue must be less than marginal cost.
• B)price must be less than the average variable cost.
• C)price must be less than average total cost but greater than average variable cost.
• D)the average revenue curve must lie below the average variable cost curve but above the average fixed cost curve.
• E)price must be less than both average variable cost and average fixed cost.

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