If the Price Is Greater Than the Average Variable Cost

question 170

Multiple Choice

If the price is greater than the average variable cost and less than the average total cost at the profit-maximizing quantity of output in the short run,a perfectly competitive firm will:

• A)continue to produce at an economic loss.
• B)earn an economic profit.
• C)encourage other firms to enter the industry.
• D)produce more than the profit-maximizing quantity.

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