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A Firm Operating in a Perfectly Competitive Market Finds Itself

Question 118

Multiple Choice

A firm operating in a perfectly competitive market finds itself producing a level of output for which marginal revenue is less than marginal cost. In order to maximize profits (or minimize losses) , the firm should


A) increase its level of output.
B) decrease its level of output.
C) shut down operations.
D) lower its price.
E) raise its price.

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