Claude's Copper Clappers Sells Clappers for $40 Each in a Perfectly

question 96

Multiple Choice

Claude's Copper Clappers sells clappers for $40 each in a perfectly competitive market.At its present level of output,Claude's marginal cost is $39,average variable cost is $45,and average total cost is $60.To improve his profit or loss situation,Claude should _____

• A)increase output.
• B)reduce output but not to zero.
• C)continue to produce the present level of output.
• D)shut down.
• E)increase the price.

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Definitions:

Homeostasis

The self-regulating process by which biological systems maintain stability and equilibrium while adjusting to conditions that are optimal for survival.

Equilibrium

Equilibrium refers to a state of balance or stability within a system, where competing forces or influences are in equal opposition.

Goal-Oriented

Focused on setting and achieving specific objectives or targets, often within a defined timeline or set of conditions.

Drive Theory

A psychological theory that attributes motivation to be the result of biological or physiological needs that drive behavior towards satisfying those needs.