Question

The table below shows cost data for a firm that is selling in a purely competitive market. Output 1 2 80 AFC AVC ATC $300 $10
Multiple Choice Ο Ο shut down. shut down, Ο produce three units Ο produce one unit. Ο produce two units.
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Answer #1

"A"

this firn will shut down because then the price will be less than the average variable cost, for a competitive firm the market the price and the marginal cost are the same.

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