If a Competitive Firm Is Operating in Short Run Equilibrium

question 31

Multiple Choice

If a competitive firm is operating in short run equilibrium and then its fixed costs fall by 40 percent, it should:

• A)use more labor and less capital in current production.
• B)not change its output.
• C)increase its output.
• D)decrease its output.
• E)stop producing.

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Definitions:

Scott Henggeler

A psychologist known for his work in developing multisystemic therapy (MST), an intensive family- and community-based treatment for serious juvenile offenders.

Problem-solving Therapy

A psychological treatment that helps individuals cope with stressful life experiences through effective problem-solving skills.

Counterconditioning

A behavioral therapy technique that involves teaching the client to replace unwanted responses to a stimulus with a desired behavior.

Paradoxical Directives

A therapeutic technique where clients are instructed to engage in or continue the problematic behavior, leading to awareness and change.