In the short run, a purely competitive firm will always make an economic profit if
A) P = ATC.
B) P AVC.
C) P = MC.
D) P ATC.

Name: In the short run, a purely competitive firm will always make an economic profit if A) P = ATC. B) P > AVC. C) P = MC. D) P > ATC.
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Question

In the short run, a purely competitive firm will always make an economic profit if
A) P = ATC.
B) P > AVC.
C) P = MC.
D) P > ATC.

Quizplus · Accepted Answer

In the short run, a purely competitive firm makes an economic profit when the price (P) is greater than the average total cost (ATC), as this means the firm is covering all its costs and making a profit above them.

In the Short Run, a Purely Competitive Firm Will Always