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Graph 14-1 This Graph Depicts the Cost Structure for a Firm in Structure

Question 77

Multiple Choice

Graph 14-1
Graph 14-1 This graph depicts the cost structure for a firm in a competitive market. Use the graph to answer the following question(s) . -Refer to Graph 14-1. When market price is at MC<sub>2</sub>, a firm producing output level Q<sub>1</sub> would experience: A) profits equal to (MC<sub>2</sub> - MC<sub>1</sub>) * Q<sub>1</sub> B) zero profits C) losses equal to (MC<sub>2</sub> - MC<sub>1</sub>) * Q<sub>1</sub> D) losses because P < ATC
This graph depicts the cost structure for a firm in a competitive market. Use the graph to answer the following question(s) .
-Refer to Graph 14-1. When market price is at MC2, a firm producing output level Q1 would experience:


A) profits equal to (MC2 - MC1) * Q1
B) zero profits
C) losses equal to (MC2 - MC1) * Q1
D) losses because P < ATC

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