The Figure Given Below Shows the Demand and Cost Curves

question 132

Multiple Choice

The figure given below shows the demand and cost curves of a perfectly competitive firm. Figure: 23.4 D: Demand curve
MC: Marginal cost curve
ATC: Average-total cost curve
AVC: Average-variable-cost curve
Refer to Figure 23.4.The presence of the average-variable-cost curve suggests that the firm is operating:

• A)in the short run.
• B)in the long run.
• C)at a gain.
• D)in a monopoly.
• E)at a zero profit.

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Definitions:

Investment Model

Theory that uses three factors—satisfaction, alternatives, and investments—to explain why people stay with their long-term relationship partners.

Sunk Costs

Costs that have already been incurred and cannot be recovered, which should not influence future decisions but often do.

Alternatives

Different options or choices available in any given situation or decision-making process.

Longitudinal Studies

Research methods that involve observations of the same subjects over a period, often years or decades, to determine long-term effects or trends.