In the short run,a perfectly competitive firm is producing an output level where marginal cost equals $10,average total cost equals $7,and marginal revenue equals $9.Which of the following statements is correct?
A) The firm is earning an economic profit which could be increased by raising output.
B) The firm is earning an economic profit which could be increased by lowering output.
C) The firm is maximizing its economic profit.
D) The firm is suffering an economic loss which could be decreased by raising output.
E) The firm is suffering an economic loss which could be decreased by lowering output.
Correct Answer:
Verified
Q108: Q109: A firm suffers an economic loss whenever Q110: In the short run, Q111: A firm will shut down if![]()
A)price
A)economic profit is always
A)it earns
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