In the Long Run, a Profit-Maximizing Firm Will Choose to Exit

question 330

Multiple Choice

In the long run, a profit-maximizing firm will choose to exit a market when

• A)average fixed cost is falling.
• B)variable costs exceed sunk costs.
• C)marginal cost exceeds marginal revenue at the current level of production.
• D)total revenue is less than total cost.

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Definitions:

Negative Reinforcement

A type of operant conditioning that involves the removal of an unpleasant stimulus to increase the likelihood of a behavior being repeated.

Unfavorable Stimulus

A stimulus considered unpleasant or adverse, which can alter behavior when removed following a specific action.

Favorable Stimulus

A stimulus that elicits a positive response or behavior from an organism.

Negative Reinforcement

A behavior modification technique that increases the likelihood of a behavior by removing or avoiding a negative outcome or stimulus.