If Price Is Below Average Variable Costs at All Rates

question 414

Multiple Choice

If price is below average variable costs at all rates of output, the quantity supplied by a perfectly competitive firm will equal

• A) zero.
• B) the rate of output where price equals marginal cost.
• C) the rate of output associated with the break-even point.
• D) the rate of output where marginal revenue equals average fixed costs.

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