Assume You Know the Following Short Run Information for a Perfectly

question 33

Multiple Choice

Assume you know the following short run information for a perfectly competitive firm: $\begin{array}{c}\begin{array}{lll}\text {Quantity}\\\\6 \\7 \\8 \\9 \\10 \\11 \\12\end{array}\begin{array}{lll}\text {Price}\\\\10\\\\\\\\\\\\ \\\end{array}\begin{array}{cc}\text { Total } & \text { Marginal } \\\text { Revenue } & \text { Revenue }\\\\\\\\\\\\\\\\\end{array}\begin{array}{lll}\text {Total}\\\text {Cost}\\30\\35\\42\\51\\62 \\75\\90 \end{array}\begin{array}{cc}\text { Marginal } & \text { Total } \\\text { Cost } & \text { Profil } \\& \\& \\& \\&\\\\\\ \\\end{array}\end{array}$
Based on the information above, which of the following is false?

• A)The firm's average total cost of production increases for outputs in excess of 8 units.
• B)The firm's average total cost of producing 7 units is the same as for producing 6 units.
• C)The profit maximizing level of output for the firm would be 10 units.
• D)In the long run, the firm's price would be less than $10.

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Definitions:

Information Processing Approach

A cognitive psychology theory that compares human thought processes to computer analysis, emphasizing ways in which people focus on, analyze, store, and retrieve information.

Piaget

Jean Piaget was a Swiss psychologist known for his pioneering work in child development, particularly his theory of cognitive development that describes how children's intellect grows.

Vygotsky

A psychologist known for the sociocultural theory, emphasizing the importance of social interaction in the development of cognition and learning among children.

Automatization

The process of making an action or process automatic, often through practice or technology, decreasing the need for conscious involvement.